Best intraday stocks to watch out for on October 07

After September month's derivative expiry, Nifty registered two very bullish days, which ultimately filled the gap area of September 26.

In the last four trading sessions, the index climbed over 3% and tested the 20 and 50-DMA resistance on the way up. Nifty also tested the 50% retracement level of the prior upside move. On Thursday, Nifty opened with a big positive gap but did not sustain above the first 75 minutes high. It mostly oscillated in a capped range; however, in the last leg of the trading session, volatility kicked in amid weekly option expiry. As a result, it formed a bearish candle carrying an upper shadow on the daily chart. Furthermore, it has closed almost at the day's low.

In any case, a gap-down and negative closing on Friday will confirm the reversal. As mentioned earlier, the zone of 17,400-500 is crucial for the bulls to sustain the moment. At the same time, the 50-DMA and 200-DMA are acting as resistance & support for now. A decisive close on either side will give a strong directional move. As the momentum is waning, the MACD histogram has reached near the zero line on an hourly chart.

For the time being, it is better to take out some profit from the last three days of the rally. Even in the global markets, momentum is seen waning after experiencing a rally. 

HCLTECH

The stock closed above the prior swing high with a higher volume. The stock is trading above the 20 DMA and 50DMA. The 20DMA just turned up and the stock has formed a base at Rs 877. The MACD line is above the zero line and the histogram shows an increased bullish momentum. As the stock is also above the moving average ribbon, it shows a bullish set up. The Elder impulse system has formed a series of bullish bars, while the KST and the TSI indicators show a bullish bias. The RRG RS and Momentum are above the 100 zone and show stronger relative performance. In short, the stock shows bullish strength. A move above Rs 964 is positive, and it can test Rs 1010. Maintain a stop loss at Rs 955.

ULTRACEMCO 

The stock has formed a lower high candle and tested the previous day's low, while the higher volume confirms the reversal. It got the bearish reversal confirmation for the previous day's evening star candle. It is sustaining below the 20DMA and 50DMA. In fact, the 20DMA is below the 50DMA, which is negative and the RSI is below the 45 zone. The last three candle closings are below the opening. It closed below the Anchored VWAP while the KST is in a bearish set-up. In short, the stock is showing signs of reversal. A move below Rs 6290 is negative, and it can test Rs 6110. Maintain a stop loss at Rs 6350.