Motilal Oswal's top technical stock ideas for 2020

SUMMARY

Indian benchmark indices gave double digit returns in 2019, with the Sensex rising around 15 percent and the Nifty50 gaining over 13 percent. Analysts believe stock market momentum will continue to remain positive in 2020 over hopes of improving economic growth after government measures such as corporate tax cuts. Motilal Oswal has picked five technical stock ideas for 2020. Here is the list: (Disclaimer: CNBCTV18.com advises users to check with certified experts before taking any investment decisions)

By CNBC-TV18Dec 31, 2019 2:35:18 PM IST (Published)

Hindalco formed a Bullish Harmonic Pattern called Bullish 5-0 pattern on monthly chart and started rebounding from the Potential Reversal Zone of the same. Recently, stock gave a breakout from a Falling Channel on weekly chart and sustaining above the breakout level. Price also gave a breakout from a Triangle pattern on daily chart with healthy volumes. Currently, stock is forming a Bullish Engulfing pattern on quarterly chart, which is a positive sign for the stock. Looking at above technical evidences, traders are advised to buy the stock in the zone of 210-218 for an up move towards 260-280. Stop-loss for the above trade setup shall be placed at 192 on closing basis. (Source: Motilal Oswal)

Tata Motors: The Nifty Auto index gave a Trendline breakout on daily chart and sustaining well above the same. Thus, we may see continuation of ongoing momentum in Auto stocks in coming weeks. Tata Motors rallied sharply in last three months with healthy volumes, which is a positive sign for the stock. Recently, stock gave a breakout from Bullish Flag pattern on daily chart and sustaining well above the breakout level. We are also witnessing a Golden Crossover of 50 and 200 SMA on daily chart, indicating further strength in counter. Looking at current price structure, we won't be surprised to see an up move towards 215-225 levels in coming months. Thus, any decline towards 177 shall be used as buying opportunity with a stop-loss of 165 on closing basis. (Source: Motilal Oswal)

PVR is moving in strong uptrend by maintaining Higher Highs - Higher Lows on weekly chart. Price was moving in a consolidation phase from last three weeks and resulted into formation of Bullish Flag pattern on weekly scale. It gave a breakout from the Pole & Flag pattern and sustaining above the same. Momentum oscillator RSI is placed positively on both daily and weekly chart and thus showing strength in the counter. Considering overall chart structure, we are expecting the stock to move towards 2200 in coming months. Thus, any dip towards 1860 shall be used a buying opportunity with a stop loss of 1795 on closing basis. (Source: Motilal Oswal)

Max Financial Services took support around 100 EMA on monthly chart and turned northwards. Stock gave a range breakout in November and rallied sharply. The upmove was supported by healthy volumes, indicating buying interest of stronger hands. The ongoing up move is combination of Impulse and Corrective moves, which is a healthy sign for the counter as strident rally generally gets fizzle out soon. Currently, price is moving above its previous swing highs and getting ready for further rally towards 640 - 670 levels. Thus, traders are advised to buy the stock in the range of 520 - 540 with stop-loss of 490 on closing basis. (Source: Motilal Oswal)

City Union Bank is a steady performer and trading around its all-time high. It is making Higher Highs - Higher Lows on weekly chart and moving within the territory of a Rising Channel from last 34 months. Currently, the stock is giving a breakout from a Bullish Flag pattern on the daily chart. RSI and MACD indicator is placed positively along with a set of moving averages, indicating strength in the counter. Overall chart structure is quite strong and thus we advise traders to buy the stock at current juncture and on dips to 230 with a stop-loss of 215 on closing basis. On upside, we may see 275 levels in coming months. (Source: Motilal Oswal)