Jay Purohit, Technical Analyst at Angel Broking has recommended trading strategies on Tata Motors, Amara Raja Batteries and Adani Ports. He gave following rationale for technical strategies:
1. Tata Motors
View-Bullish
Last Close-Rs. 443.05
''After a sharp correction from Rs. 551.90 to Rs. 434.55, the stock has started moving in sideways direction. The consolidation phase of last two months has resulted into formation of a Bullish Harmonic Pattern called 'Bullish Bat' on daily chart. The Potential Reversal Zone (PRZ) of the same is placed at Rs. 436.45-Rs. 440. The mentioned PRZ coincides with the 'Trendline' support on daily chart. Also, '200 EMA' on weekly chart and 50% retracement levels of the previous rally from Rs. 265.80 to Rs. 598.40 is placed in the zone of Rs. 432-Rs. 434 levels. Yesterday, the stock rebounded from the mentioned PRZ and formed a 'Doji' candle, which can be a reversal trigger. Considering the cluster of support levels and formation of a Bullish Harmonic Pattern, we are expecting reversal in the counter. Thus, we advise traders to buy this stock at current levels and on declines to Rs. 440 for a target of Rs. 475 over the next 14 to 21 sessions. The stop loss should be fixed at Rs. 428.''
2. Amara Raja Batteries
View-Bullish
Last Close-Rs. 868.85
''Post a correction on back of an announcement of 'Demonetization', the stock has started moving in sideways direction. The ongoing consolidation phase of last three months may result into formation of an 'Inverse Head & Shoulder' pattern on daily chart. Currently, the stock is trading at the lower end of right shoulder of a mentioned pattern. Yesterday, the stock had showed some strength and formed an 'Outside Bar' pattern on daily chart. A follow-up buying in upcoming session may result into short term reversal in the counter. In addition, the 'RSI' oscillator is rebounding from its bullish support of 40 levels on daily chart. Considering above technical evidences, we are preempting a formation of 'Inverse Head & Shoulder' pattern, whose'Neckline' is placed around Rs. 912. Thus, we advise traders to buy this stock at current levels to a decline up to Rs. 860 for a target of Rs. 945 in upcoming sessions. The stop-loss should be kept at Rs. 834.''
3. Adani Ports
View-Bullish
Last Close-Rs. 325.80
''The stock is moving in a strong uptrend from last many months. However, we are witnessing a corrective move in the counter from last two weeks. The ongoing correction may end at current juncture as the stock is taking support around the 'Horizontal Trendline' adjoining previous swing highs (316-317 levels). The 'RSI' oscillator on daily chart is showing 'positive reversal', indicating probability of a positive momentum in near term. Looking at current chart structure, we are expecting resumption in upward momentum in the counter. Thus, we advise traders to buy the stock from current level to a decline up to Rs. 322 for a target of Rs. 355 in upcoming sessions. The stop-loss can be placed at Rs. 313.''
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