10 trading ideas for October expiry week that could give up to 22% return in next 3-5 weeks

Indian market ended lower with a loss of about 1 per cent. The Nifty50 saw profit-taking after hitting a record high above 18600 levels last week.

Mixed global cues, as well as muted results from India Inc., weighed on the sentiment. The broader market underperformed benchmark indices for the week ended October 22 which dampened the sentiment.

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The S&P BSE Mid-cap index was down over 4 per cent, while the S&P BSE Small-cap index fell over 5 per cent for the week ended October 22.

Experts are of the view that for bulls to regain control a close above the hurdle zone of 18300-18400 is required while on the downside 18000-18060 will act as crucial support.

“As far as levels are concerned, 18060 – 18000 are to be considered as crucial supports whereas on the flipside, 18260 – 18400 would be seen as immediate hurdles,” Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel One Ltd) said.

“Since the weekly chart of the midcap index is showing a bearish formation, which can be termed as ‘Engulfing’ candle, we advise traders not to create aggressive longs in high beta counters,” he added.

The thematic approach can still be followed, but one needs to be very selective now, cautions Chavan. “Below 18000 for Nifty, the near-term uptrend gets negated, and then we are up for some correction which is overdue for a long time,” he added.

We have collated a list of top 10 trading ideas from experts that could give a 6-22% return in the next 2-5 weeks:

Expert: Kavita Jain, Learning Head & Sr. Equity Research Analyst at Arihant Capital

Bank of Baroda: Buy| LTP: Rs 94.60| Target: Rs 105| Stop Loss: Rs 85| Upside 11%
 
The counter is witnessing a Head & Shoulder breakout pattern on the monthly chart and a Symmetrical Triangle breakout on the weekly time frame.

PSU Banks are in momentum. The stock is trading above all its moving averages. ADX indicator is placed at 41.30 and the leading indicator such as RSI is also showing further price strength.

Indiabulls Real Estate: Buy| LTP: Rs 162| Target: Rs 185-190| Stop Loss: Rs 142| Upside 17%

The counter has witnessed a Rounding Bottom formation breakout on October 18 and took a meaningful correction from its last high of 186.

On the daily time frame, the counter is displaying a ‘Bullish Harami’ – a bullish reversal candlestick formation which is coinciding with its 20-days EMA. A decisive move above 167 will lead the stock to its previous high of 185-190.  

EID Parry: Buy| LTP: Rs 470| Target: Rs 505| Stop Loss: Rs 450| Upside 7%
 
The stock has come out of the consolidation zone of 390-414 on 19 October and brought meaningful correction in the last week. ADX and RSI is showing price strength, and the stock is trading above all its averages.

Expert: Mehul Kothari, AVP – Technical Research at AnandRathi

Axis Bank: Buy Above 828| LTP: Rs 816| Stop Loss: Rs 790| Target: Rs 910| Upside 10%

The NIFTY BANK index has been an outperformer for quite a few sessions. Axis Bank is on the verge of a multi-year breakout.

The breakout will get confirmed above the Rs 828 mark and once that is taken out, we expect a fast upside momentum in the stock.

Traders are advised to buy the stock above Rs 828 with a stop loss of Rs 790 for an upside target of Rs 910 in the coming 3 – 5 weeks.

IDFC First Bank: Buy| LTP: Rs 50| Stop Loss: Rs 45| Target: Rs 60| Upside 20%

After a sharp fall from the top of 69, the stock took a U-Turn from the support of 40 which was the placement of 200-week’s EMA. After that, the stock has confirmed a falling trend line breakout above Rs 50 mark.

The stock has a placement of 200-DEMA at 52 and above that, we expect a sharp upside in the counter. Traders are advised to buy the stock near 50 with a stop loss of 45 for the upside potential target of 60 in the next 3 – 5 weeks.

PC Jeweller: Buy above Rs 29| LTP: Rs 28.2| Stop Loss: Rs 26| Target: Rs 35| Upside 20%

PC Jeweller has recently confirmed a range breakout above 27 and rallied towards the Rs 31 mark. Due to the ongoing profit booking in the market, the stock has again retested the breakout zone.

At this point, the risk-to-reward ratio looks lucrative to go long. Traders can buy the stock above 29 with a stop loss of 26 for an upside target of 35 in the next 3 – 5 weeks.

Expert: Aditya Agarwala, Senior Technical Analyst, YES SECURITIES

Bandhan Bank: Buy| LTP: Rs 323| Target: Rs 350| Stop Loss: Rs 307| Upside 8%

The stock is on the verge of a breakout from a bullish Flag pattern neckline placed at 332. A successful breakout on volumes will resume the uptrend taking the stock higher to levels of 350. Further, the RSI indicator is also confirming the bullishness.

Asian Paints: Buy| LTP: Rs 2984| Target: Rs 3160| Stop Loss: Rs 2880| Upside 6%

The stock has tested its previous peak which is acted as a support and turned upwards suggesting a short covering is on the card. Further, RSI has turned higher from the previous reversal zone of 25 confirming bullishness building up.  

Expert: Rajesh Palviya, VP - Technical and Derivative Research at Axis Securities

HDFC Ltd: Buy| LTP: Rs 2902| Target: Rs 3100-3200| Stop Loss: Rs 2850| Upside 12%

On the daily chart, the stock has broken out from a “Rounding formation” at 2850 levels on a closing basis along with rising volumes.

The stock is trending up across all the time frames forming a series of higher Tops and higher Bottoms representing a strong uptrend

This buying momentum was observed from 20-day SMA (2775) which reconfirms bullish sentiments.

The daily and weekly strength indicator RSI is in bullish mode along with positive crossover which supports rising strength. The above analysis indicates an upside of 3100-3200 levels. The holding period is 3 to 4 weeks.

RITES Ltd: Buy| LTP: Rs 310| Target: Rs 380| Stop Loss: Rs 295| Upside 22%

On the daily chart, the stock has witnessed a “Multiple Resistance” breakout at 300 levels. Rising volumes at the breakout zone imply increased participation in short-term corrections.

The stock is well placed above its 20, 50, and 100 Day SMA which reconfirms upside momentum. The weekly Band-Bollinger buy signals increased volatility along with rising prices.

The daily and weekly strength indicator RSI is in bullish mode along with positive crossover which supports rising strength. The above analysis indicates an upside of 350-380 levels. The holding period is 3 to 4 weeks.

(Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)