Stock picks of the day for December 07, 2018

PVR: Buy above 1531| LTP: Rs 1489| Target 1700| Stop Loss: Rs 1428| Return 14%

Looking at the weekly chart, the stock has been correcting in a ‘Downward Sloping Channel’ pattern since the beginning of May 2017. Subsequently, the stock formed strong base near 1100 – 1060 zone and rebound sharply.

As a result, PVR broke the upper band of the channel pattern which led to a breakout. The weekly RSI (14) entered above the 60 level which supports our hypothesis.

Hence, we advocate traders to buy this stock above 1531 with a price target of 1700 and a stop loss placed below 1428.

RIL: Sell around Rs 1,130 - 1,140| LTP: Rs 1123| Target: Rs 1050 - 1016| Stop Loss: Rs 1187| Return 6%

After forming a ‘Bullish Divergence’ in the month of October; 2017, stock saw decent run up and tested 1180 – 1190 zone.

Looking at the daily chart, the said zone coincided with the 50% retracement of its entire fall from the top of 1329 to the bottom of 1016.40.

During Thursday’s trade, Reliance broke the upward sloping trend line drawn from the swing low of 1016.40 which indicate that the stock is likely to resume its downtrend.

Hence, we recommend traders to go short in this counter in a range of 1130 – 1140 with a downside target of 1050 first and in case of further pessimism stock can retest its bottom of 1016. A stop loss for short positions should be placed above 1187.

Disclaimer: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.

Voltas: Sell around 537| LTP: Rs 538| Target 480| Stop Loss: Rs 570| Return 11%

Looking at the daily chart, the stock reversed after testing its 200-DMA during November 20, 2018. Subsequently, stock descended and broke the upward sloping trend line join from the bottom of its swing low of 472.25.

The daily RSI (14) reversed after testing the 60 levels. Also, the weekly Lower Top Lower Bottom formation is intact.

Hence, we recommend traders to go short in this counter at the current level of 537 with a downside price target of 480. A stop loss should be placed above 570 on a closing basis.