3 stocks Rajesh Palviya is betting on for next week

“Clearly is a winning stock from that sector and we believe that the kind of breakout which we have witnessed in ITC can really extend further,” says Rajesh Palviya, Axis Securities.

Let us just talk about the markets that we are seeing coming in, Nifty up 1.4%. Midcap space has also managed to snap its four-week losing streak and finally managed to gain this week as well. What is your understanding of the markets? What are we looking at in terms of the markets going forward for the next week there?
So yes, it was a very volatile week. A lot of events were lined up throughout the week and the market has reacted to all the events and especially at the end of this week has shown some sort of recovery, especially short covering action was there in the Nifty as well as in the Bank Nifty. 17500 is likely to act as a major support area as of now on a near term to short term basis because multiple times we have seen Nifty attempting to break those levels but on the closing basis that level is defended by the market throughout the week also.

So 17500 would be our stop loss to remain on the long side. Also, we have seen some short covering action on the call writing front so this upside momentum we can expect towards 18000-18100 in the continuation of the trade.

So our target is 18000 to 18100 on the higher side, stop loss for taking a long position is at around 17700. In Bank Nifty also there was again short covering action. Now Bank Nifty is comfortably closed above 41000 level. So looking at the recovery especially in the second half of the market, we believe that this momentum can extend further towards 41800 to 42000 in the continuation of this trade. So one can remain long with a stop loss of 41100 and we are projecting a target of 41800 to 42000.

I want to talk more in terms of a sector specific that is FMCG. We had a whole host of numbers that actually came out of the FMCG space this week as well. FMCG has actually gained for the second straight week. ITC was at its lifetime high. also saw a stellar move coming in post its numbers as well. What are you picking up and understanding from the FMCG space, anything that you are liking over here then?
Clearly ITC is a winning stock from that sector and we believe that the kind of breakout which we have witnessed in ITC can really extend further. We believe that this stock can move further higher from the current levels also. So those who are already holding the position, they can remain invested. Upside target for ITC could be around Rs 400-415 in the continuation of this uptrend. One can now keep a stop loss of around Rs 365. Another stock which we like from that pack is Asian Paints. It is also showing some bit of recovery from its recent low. After a consolidation of five-six trading sessions, now stock has shown a good breakout of its falling channel on the daily chart. So looking at the breakout and at the short covering action, we believe that

can continue further uptick from the current level. We are projecting an upside target of around Rs 2830-2850 for a stop loss of around Rs 2700. So these two stocks are looking promising from this pack.

What is happening with Adani, how can it impact banks, what is your view? You think correction is a buying opportunity for the banking sector as a whole?
Yes, there was panic in banks also when Adani stocks were getting hammered throughout the week but most of the banking stocks have shown some short covering action also.

So from PSU space, yes, again, , and are looking attractive. SBI after numbers again, have to see how it reacts but overall if we talk about the long term perspective, the overall structure for SBI is still bullish and despite the last two month correction stock is now again trading above the 200 day moving average.

So looking at the overall setup for SBI, we believe that if stocks continue to hold above 530 level then possibly again stock can scale up further higher towards 570-580 which is the next critical area for this pullback.

If at all stock crosses above 580 level then it will again resume its uptrend which we have witnessed earlier part of this year. So looking at the overall setup, we are bullish on SBI also with a stop loss of 530. Bank of Baroda is another stock which we feel that upside can be continued towards 181-195 zone, one can buy and hold this stock also with stop loss of 150.

I want to talk about the cement pack. Now when you look at the cement pack what we see and understand, yes demand is coming back but channel checks are suggesting that they are not able to take those price hikes. We are not seeing any price increases coming in there for the cement players. So how are you looking at the cement pack? Anything that you are liking from the cement stocks?
Clearly if I go with stocks,

and Ambuja have been beaten down so we will avoid those stocks at this current level based on the technicals. But is looking attractive. The kind of recovery which we have seen throughout the week in UltraTech stock is almost trading near to its multiple resistance zone area which is at around 7250-7300 level.

If at all the stock crosses those levels then possibly

can move further higher from the current level and possibly the next target for the stock could be around 7550 to 7600 in the continuation of this pullback.

So overall this stock is looking attractive, one can buy this stock in any kind of minor corrective action also with stop loss of 7000. Another stock which we like from this space is JK Cement. After corrective moves again

is now consolidating at lower bend. Looking at the overall setup now stock is holding its previous swing low which was made in the last part of January month so 2550 is the important level, if it continues to hold this level then this stock can also show some pullback action from the current level and 2800 could be the possible target in the near term. 2550 should be the stop loss to buy JK Cement for an upside target of 2800.

What are your topics then?
In this volatile market we have seen strong buying action in the automobile space and from that space we like

Motor at the current level. If we analyse the overall stock setup it is holding its 200-day moving average since the last 10-15 trading session and on the near term setup stock is now trading above its 50-day moving average also.

So looking at the consolidation breakout on the weekly chart we believe that this momentum is likely to continue further. We are expecting a target of 3450 from a trading point of view. Keep a stop loss of 3270 to buy Eicher Motor.

The Second stock which we like is Chola Finance. Stock has given a strong breakout. It has managed to cross its November high also. Looking at the weekly setup we believe that the kind of candle

has formed in this week clearly shows that stock is going to continue its uptrend towards 840-850 zone. So one can buy this stock also with the stop loss of 755.

Third stock is from telecom space which is Bharti Airtel. After corrective moves now

managed to give breakout of last two week consolidation.

Stock has formed a base at around 750-760 zone and the kind of recovery we have witnessed in the current week clearly suggests that some more short covering action can be there in the stock. Stock can scale up further higher towards the 830 zone. So Bharti Airtel one can buy with a stop loss of 770.