Stock Picks of the Day: 3 stocks that could return 10%

The Nifty fell more than 50 points from its intraday high on Monday to end the day with gains of 19 points. It finally closed at one-month high of 10,786.

Last week, the index surpassed crucial resistance of the previous top placed at 10,736 and confirmed the higher top and higher bottom formation on the daily charts.

It is trading comfortably above its 20, 50, 100 and 200-day daily moving average indicating a bullish trend in the short to medium term. Oscillators like relative strength index, directional movement indicator and moving average convergence divergence have been showing strength on Nifty and Bank Nifty charts, indicating a possibility of more upside from current levels.

Midcap and smallcap indices have formed a bullish hammer candlestick pattern on the weekly charts. The advance-decline ratio was also positive for the fourth day in a row. It’s the first time after February (February 7-12) where the ratio was positive for four straight days in a row.