Stock Picks of the Day: 5 buy ideas that could return 11-15%

The Nifty, which started higher, traded mostly with a positive bias before closing 70 points higher on Wednesday. During the session, it moved above the most recent inflection point on the daily chart, which suggests growing optimism.

It ended the session above its 21-day double exponential moving average for the first time in few days. The Nifty moved above the 61.8 percent retracement of the previous fall from 10,893 to 10,557, which says that the index has recovered almost two-third of the previous fall.

The momentum oscillator, relative strength index (RSI) has entered into a bullish crossover and is currently staying above the 50 mark. On the options front, 11,000 CE and 10,800 CE have seen highest activity, whereas 10,600 PE and 10,500 have remained most active.

However, the recent upmove in the Nifty has found initial resistance at the falling trend line on the daily chart. A clean takeout of the falling trend line, which is currently pegged at 10,772, is expected to set Nifty for a rally towards 10,830-10,900. If the index does close above 10,900 then it may move towards 11,000 levels.

On the other hand, failure to move above 10,772 may attract selling in the market. On the lower end supports are placed at 10,670/10,550.