Buy or sell stocks: The Indian stock market continued to trade in a narrow range for yet another session on Friday last week. The Nifty 50 index ended 34 points lower at the 24,964 mark, below the psychological 25,000 level. The BSE Sensex shed 230 points and closed at 81,381, while the Nifty Bank index finished 358 points lower at 51,172. The small-cap index went up 0.44% in the broad market, whereas the mid-cap index also added 0.44% during Friday deals.
Sumeet Bagadia, Executive Director at Choice Broking, believes the overall Indian stock market bias is cautious, as the Nifty 50 stocks are trading in a tight 24,900 to 25,300 range. The Choice Broking expert said that a bullish or bearish trend could be assumed on the breakage of either side of this range. On breaching either side of this range, the 50-stock index may show a 200-point upward or downside move, said Bagadia.
Sumeet Bagadia recommended buying Divi's Laboratories, HCL Technologies, and Hindalco Industries on Monday.
1] Divi's Laboratories: Buy at ₹6142.25, target ₹6555, stop loss ₹5925.
Divi's Laboratories share price daily chart analysis offers a favourable view for the coming days ahead, indicating a sustainable upside bounce this week. The stock price moved in a larger consolidation pattern in the last few months and has broken out of the consolidation range of ₹5300 to ₹5450 this week.
A sustainable move above the hurdle has already led to a decisive upside breakout, and the stock is now attempting to reach the next target of ₹6555, potentially driving a sharp positive impact on the stock price.
Furthermore, Divi's Laboratories share price is trading above its crucial 20-day, 50-day, and 100-day Exponential Moving Average (EMA) levels, reinforcing the bullish trend. The increase in trading volume and the stock trading above the Volume Weighted Average Price (VWAP) for the short term is ₹6085, further supporting a bullish scenario. Investors, especially those who entered at lower levels, could consider a prudent approach by booking partial profits at the current market price (CMP). Simultaneously, trailing stop-loss orders near ₹5925 levels can safeguard profits and manage risks effectively.
For fresh investments, a disciplined strategy involves waiting for potential dips, considering entry points near ₹6060 levels. Implementing a strict stop-loss at ₹5925 levels offers a risk management mechanism, ensuring protection against adverse market movements.
2] HCL Technologies: Buy at ₹1839.65, target ₹1950, stop loss ₹1777.
HCL Technologies' share price has demonstrated remarkable strength and positive momentum in recent high-volume trading sessions, currently trading at ₹1839.65. The stock's recent consolidation within the ₹1775 to ₹1815 range has laid the foundation for a potential upward movement, emphasized by a bullish, engulfing candlestick pattern on the weekly charts.
HCL Technologies share price maintains a robust technical posture by comfortably holding its position above the crucial 20-day, 50-day, and 200-day Exponential Moving Averages (EMA), reflecting a solid base and signalling a positive trend. The Relative Strength Index (RSI), a pivotal momentum indicator, is rising and currently stands at 65 levels.
As HCL Technologies' share price gears up to confront the next target level at ₹1950, its ability to sustain itself above critical support levels during pullbacks suggests a solid technical setup. They employ trailing stop losses with a protective buffer near the significant support level of ₹1777 — a prudent risk management strategy for investors who entered the market at lower levels. In conclusion, the technical analysis paints a favourable picture of HCL Technologies' share price, indicating the potential for further upward movement and instilling confidence among investors.
3] Hindalco Industries: Buy at ₹747.35, target ₹800, stop loss ₹720.
Hindalco share price Limited is currently trading at ₹747.35, showcasing a notable uptrend from the support levels around ₹715, in close proximity to its 20-day Exponential Moving Average (EMA). The stock's positive momentum is further confirmed by its positioning above the short-term (20-day), medium-term (50-day), and long-term (200-day) EMA levels, reinforcing its technical resilience.
A significant breakthrough above the resistance at ₹750, supported by robust volumes, underscores the stock's strength. A sustained closure above this resistance could propel the stock to the next target of ₹800. Traders and investors who entered at lower levels are advised to safeguard their positions by trailing stop losses near 720, aiming for the target of ₹800 and beyond.
The momentum indicator, Relative Strength Index (RSI), is currently at 65 levels, indicating positive momentum in the stock. For those considering fresh investments, purchasing at the current market price (CMP) is a viable option, targeting ₹800, with a stringent stop loss set at ₹720 levels to manage risk effectively.
Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary. It is also clear that Hindalco Industries is a sister concern of HT Media Ltd, and the stock selection is completely a prerogative of the market expert.
