Here's why Vinay Rajani recommends buying Timken India, Ashok Leyland

The technical analyst from HDFC Securities recommends going long on the Nifty with a stop at 15,500.

Nifty View

The Nifty has been rising for the last four consecutive sessions. Last week, the Nifty managed to form higher top and higher bottom pattern on a closing basis, which indicates bullish trend reversal for the short term.

At present, the Nifty is in continuation of an uptrend, where next resistances are seen at 16,100 and 16,235 levels. Trading longs should be held with 15,500 stoploss on the Nifty.

Indicators and oscillators like MACD and RSI have turned bullish on the daily chart for the Nifty. 

Timken India

BUY

Targets: Rs 2,600, Rs 2,690

Stop Loss: Rs 2,350

Last Close: Rs 2,447

The stock price has broken out from a downward sloping channel on the daily chart. The price breakout is accompanied with rising volumes.

The primary trend of the Stock is bullish with higher tops and higher bottoms on the weekly charts. Indicators and oscillators have also turned bullish on the daily and weekly charts.

Ashok Leyland

BUY

Targets: Rs 152, Rs 157

Stop Loss: Rs 140

Last Close: Rs 145

After breaking out from the inverted head and shoulder pattern, the stock is in continuation of an uptrend.

On June 28, the stock surpassed the previous swing high of Rs 145 with rising volumes on the daily chart. The auto sector has been outperforming and the same is expected to continue.

The stock is placed above all important moving averages, indicating bullish trend on all time frames.

(Vinay Rajani, Senior Technical and Derivative Research Analyst at HDFC securities. Views expressed are personal).