7 technical trading ideas which traders can initiate in November F&O expiry week

The Nifty50 snapped 2 weeks of a winning streak and closed lower by about 2 percent in a holiday-shortened week weighed down by weak global cues. The index closed below its crucial support at 17800 levels.

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Participants turned cautious over the rising US inflation, which may trigger faster than expected tapering and rate hikes suggest experts. The broader markets too witnessed selling pressure wherein both midcap and smallcap lost in the range of 1-2%.

On the downside, 17650-17700 will act as crucial support while on the upside 18000-18200 will act as a crucial resistance level.

Technically, the index has given a breakdown of the rising trend line, and gave a closing below 50-DMA, which suggests weakness for the next trading sessions.

“From the last four trading sessions, the index has been trading with lower highs & lower lows, which points out some corrections for the next trading session,” Palak Kothari, Research Associate at Choice Broking, said.

“However, the index has taken support from the lower band of Bollinger, breaching below can show further downside. Furthermore, the index has given closing below 21 DMA as well as the Stochastic & MACD indicator is trading negative crossover, which points to weakness in the counter for the next trading sessions,” he said.

Kothari further added that at present, the index has a support level of 17650, while resistance is at 18000 levels.

We have collated a list of 7 trading ideas by experts with an investment horizon of short to medium term:
 
Expert: Kavita Jain, Learning Head & Sr. Equity Research Analyst at Arihant Capital

Power Grid: Buy| LTP: Rs 192| Target 204-209| Stop Loss: Rs 187| Upside 9%| Time 1-2 weeks

PowerGrid is forming ‘Bullish Engulfing’ which is a bullish reversal candlestick formation on the weekly chart that illustrates the culminating win of the buyers in the last week after the four weeks of correction from 210 to 180.

A Candlestick formation is also coinciding with upward sloping trendline support. A leading indicator is at 58.32 showing further price power to move upwards.  

Asian Paints: Buy| LTP: Rs 3226| Target Rs 3353-3470| Stop Loss Rs 3099| Upside 7.5%| Time 1-2 weeks

The counter is witnessing a breakout from the falling wedge price pattern formation on the daily time frame duly settled on the weekly chart too.

The price projection of the pattern suggests a target of 3470 in a week or two. A leading indicator is at 56.79 showing further price power to move upwards.  

Brokerage: SMC Global Securities Ltd

Pidilite Industries Ltd: Buy| LTP: Rs 2437| Target Rs 2550-2580| Stop Loss: Rs 2460| Upside 6%| 3-4 weeks

The stock made a 52-week low at Rs 1500.60 on 27th November, 2020, and a 52-week high of Rs 2532 on 19th October, 2021.

The 200 days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 2130.60.

Short-term, medium-term, and long-term bias are looking positive for the stock as it is trading in higher highs and higher lows on charts. Apart from this, it was consolidated in a narrow range and formed a “Bullish Pennant” pattern on weekly charts which is bullish in nature.

Last week, stock tried to give the breakout of pattern, could not hold the highs due to market’s volatility but still managed to close in positive with positive bias.

Therefore, one can buy in the range of 2410-2425 levels for the upside target of 2550-2580 levels with a stop loss below 2460 levels.

SBI Life Insurance Company Ltd: Buy| LTP Rs 1181| Target Rs 1320-1350| Stop Loss: Rs 1100| Upside 14%| Time 3-4 weeks

The stock made a 52-week low of Rs 825.20 on 22nd December 2020 and a 52-week high of Rs. 1273.90 on 06th October, 2021.

The 200-Days Exponential Moving Average (DEMA) of the stock on the daily chart is currently at Rs 1064.02.

The stock is consolidating in a narrow range and forming a “Bull Flag” pattern on the weekly chart which is bullish.

Despite the correction in the broader indices, the stock showed some strength, hold, and consolidated in a narrow range with positive bias along with high volumes.

On the technical indicators front, RSI and MACD are also suggesting buying for the stock. Therefore, one can buy in the range of 1160-1170 levels for the upside target of 1320-1350 levels with a stop loss below 1100 levels.

Expert: Bharat Gala, President - Technical Research, Ventura Securities Ltd.

Birlasoft: Buy| LTP: Rs 468| Target Rs 600-800| Stop Loss: Rs 380| Upside 70%| Time 6-9 months

Birla Soft’s stock price moved from Rs 47.60 in March 2020 to Rs 458 in Sept 2021. It continuously traded above the averages and the super trend was positive.

From June 21 to Nov 21, the stock had been trading in a narrow range and recently, it gave weekly candle breakouts and touched a high of 501.55, accompanied by supportive volumes.

Now, the Demand Index, Vortex & ROC indicators suggest a possible up move. The possible targets are 600-800.

If the stock price corrects downwards the buy levels are (464)-453-(441-435). The Stop Loss to be observed in this trade is 380.

Maruti Suzuki: Buy| LTP Rs 8112| Target Rs 10,000-14,000| Stop Loss: Rs 6740| Upside 23%| Time 6-9 months

Maruti Suzuki moved from 906 in Dec 2011 to 10000 in Dec 2017. Then came a technical correction, due to profit-booking, and the stock touched a low of 4002 in April 2020.

Since then, value buying has pushed up the stock to a high of 8400 in Jan 2021. Recently, it has demonstrated a pattern and trend line (July 2018 to Nov 2021) breakouts and made a high of 8370, accompanied by supportive volumes.

The MACD, Demand Index & ADX Indicator suggest a possible up move. The possible targets are 10000-12000-14000.

If the stock price corrects downwards, the buy levels are (7950-7690)-7485-(7275-7155). The Stop Loss to be observed in the trade is 6740.

TD Power Systems Ltd: Buy| LTP Rs 404| Target Rs 650| Stop Loss Rs 290| Upside 60%

The stock price of TD Power Systems moved from 145 in April 2021 to 365 in Sept 2021. It continuously took the support of averages, and the super trend was in a positive mode since September 2020.

Thereafter the stock traded in a narrow weekly range, making one more high of 382 in Oct 2021.

Recently, the stock gave range breakouts and made a high of 413.95, accompanied by supportive volumes.

The Demand Index, Vortex & MACD Indicator suggest a possible up move. The possible target is 650.

If the stock price corrects downwards, the buy levels are (378-355)-339-(321-310). The Stop Loss to be observed in the trade is 290.

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