Shares to buy or sell: The domestic stock market indices Sensex and Nifty 50 crashed over 1 per cent on Monday, November 4, driven by an across-the-broad selloff. The Nifty 50 index closed 1.27 per cent lower at 23,995.35 points, compared to 24,304.35 points at the previous market close.
The BSE Sensex closed 1.18 per cent lower at 78,782.24 points after Monday's trading session, compared to 79,724.12 points at the previous market close.
“Nifty Index opened flattish and the bears took over the session right from the start of the session and dropped to 23,800 zones. It was followed by some consolidation and closed with losses of around 310 points. It formed a bearish candle on the daily frame and has been making lower highs from the last three sessions. Now till it holds below 24,000 zones, weakness could be seen towards 23,800 then 23,650 zones whereas hurdles are placed at 24,200 then 24,350 zones,” said Chandan Taparia, Head – Equity Derivatives and Technicals, Wealth Management, MOFSL.
On the options front, Maximum Call OI is at 25,000 then 24,300 strike while Maximum Put OI is at 23,000 then 23,500 strike. Call writing is seen at 24,000 then 24,100 strike while Put writing is seen at 23,000 then 23,500 strike. Option data suggests a broader trading range in between 23,000 to 24,300 zones while the immediate range is seen between 23,500 to 242,00 levels.
On the Bank Nifty outlook, Taparia further added, “Bank Nifty Index opened on a flattish note but failed to hold 51,750 zones and gradually drifted lower towards 51,050 zones in the latter part of the session. It formed a bearish candle on daily scale as selling pressure was seen in banking heavyweights and it corrected almost 700 points to close near 51,200 levels. The index has got stuck in a wider range as follow up is missing at higher zones but is hovering near its 100DEMA. Now, till it holds below 51,500 zones, some weakness could be seen towards 51,000 then 50,750 levels while on the upside hurdle is seen at 51,500 then 51,750 zones.”
Chandan Taparia has recommended three stocks to buy today. These stocks are State Bank of India, Mahindra & Mahindra Ltd., and National Aluminium Co. Ltd.
The stock is retesting its breakout from a consolidation zone with high buying volumes to support the potential upmove. PSU banks are holding well in spite of broader market weakness. The MACD indicator has given a bullish crossover and is headed up confirming the upward momentum, said Taparia.
Mahindra & Mahindra: Buy at ₹2,883 | Target Price: ₹3,050 | Stop Loss: ₹2,795
Price has bounced back up from major support levels with a large-bodied bullish candle visible on the daily chart. It has also crossed above its key moving averages, suggesting a reversal. The Stochastic indicator has exited the oversold zone, suggesting bullish momentum.
The stock has formed a pennant pattern on the daily chart near its all-time high levels, suggesting a continuation of the uptrend. It is respecting its 20 DEMA with slight dips being bought into. The Rate of Change indicator has turned up which may support the up move.
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.
