Stock market today: A sharp selloff hit the Indian stock market on Tuesday, October 22, pulling down the benchmark indices, Sensex and Nifty 50, by more than 1% each.
The Sensex ended the day down by 931 points, or 1.15%, closing at 80,220.72, while the Nifty 50 dropped 309 points, or 1.25%, to settle at 24,472.10.
On the outlook for market today, Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates Ltd., said, “Domestic benchmark indices opened flat, reflecting global cues. As a result, the Nifty opened flat to positive, but the index then experienced severe selling pressure and concluded the day on a negative note at 24,472. The volatility index, INDIA VIX, rose 4.21% to 14.34, indicating an increase in market volatility."
On Bank Nifty outlook, Yedve said, "Bank Nifty began positively, but experienced profit booking after an initial rise, closing lower at 51,257. Technically, on a daily scale, the index formed a bearish candle, indicating weakness. On the downside, the 100-Days Exponential Moving Average (100-DEMA) support is positioned near 51,100, with last week’s low near 51,000. Thus, 51,000-51,100 offers good support for Bank Nifty in the short term. A sustained break below 51,000 could trigger further downside momentum, potentially leading to a more pronounced decline in Bank Nifty.”
On the technical outlook for Nifty today, Rupak De, Senior Technical Analyst, LKP Securities said, “The Nifty slipped from the head and shoulder pattern on the daily timeframe, leading to a sharp fall during the day. Sentiment further weakened after the Nifty broke below the crucial support level of 24,700. The sentiment may remain weak if the index stays below 24,700, with a "sell on rise" strategy favoured by market participants. The index has fallen below the 100 EMA for the first time since early June of this year. On the lower end, support is placed at 24,400, and if the index falls below this level, it may extend its correction towards 24,000."
Around 70 companies will declare their Q2 2024 results on Wednesday, including Hindustan Unilever, TVS Motor, Bajaj Finserv, SBI Life Insurance.
Regarding shares to buy today, stock market experts Sumeet Bagadia, Executive Director at Choice Broking, and Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, recommended buying these five stocks: Unichem Laboratories, Torrent Power, Infosys, TVS Motor, and Apollo Hospitals.
Unichem Laboratories is exhibiting strong bullish momentum, currently trading at an All-time high of 908.7 levels. The recent breakout above the crucial resistance at 755 levels is a significant technical development, supported by robust trading volumes, reinforcing the strength in the stock. The breakthrough suggests a potential continuation of the upward trend, offering an optimistic outlook for investors.
It is trading above key moving averages, including the short-term (20 Day), medium-term (50-day), and long-term (200-day) EMAs, further affirming its bullish stance. The momentum indicator, Relative Strength Index (RSI), is at 81.85 levels.
For traders, keeping an eye on the strong support near the 825 level is advisable, as a breach of this level could signal a shift in sentiment. Overall, UNICHEMLAB's current technical setup suggests a favourable environment for further upside potential, provided traders and investors remain vigilant to potential reversals and closely monitor key support and resistance levels.
Based on the above analysis we recommend buying Unichem Laboratories and the CMP of 855.75 with a stop loss of 825 for the target of 920.
Torrent Power is currently trading at 1,952.55, exhibiting a strong upward trend. The stock broke out after consolidating within the 1,900–1,950 range, indicating continued bullish momentum. Recently, it reached a fresh all-time high of 2,037, but experienced some profit booking, pulling back slightly from the peak. It remains above its 20-day, 50-day, and 200-day EMAs, which suggests robust support from both short-term and long-term trends. With the stock breaking through a key resistance level, the upward trend is likely to continue. If higher levels are breached, Torrent Power could potentially reach a target of 2100.
On the downside, immediate support is seen at 1,930. The Relative Strength Index (RSI) is at 58.88 and trending upward, reflecting increasing buying momentum. To manage risk effectively, a stop-loss at 1,900 is recommended to guard against unexpected market reversals.
Based on technical analysis and current market conditions, Torrent Power presents a promising buying opportunity, targeting 2,100, provided that risk management strategies are appropriately implemented.
The stock has a substantial support at ₹1,810, marking a crucial juncture in its recent trading. Presently, at ₹1,850, the stock has demonstrated a definitive price-action reversal, suggesting a potential continuation of its upward momentum. Traders keen on seizing this opportunity could consider buying and holding the stock, setting a prudent stop loss at ₹1,810. The anticipated target for this trade is ₹1,910, representing the next significant resistance level. This strategy positions traders favourably to capitalize on the stock's anticipated rally in the weeks ahead.
In the recent short-term trend analysis of the stock, a notable bullish reversal pattern has emerged. This technical pattern suggests the possibility of a temporary retracement in the stock's price, potentially reaching around ₹2,750. The stock is currently maintaining a crucial support level at ₹2,320. Given the current market price of ₹2,670, a buying opportunity is emerging. This suggests that investors might consider purchasing the stock at its current price, anticipating a rise towards the identified target of ₹2,750
On the daily chart of this stock, a breakout at the ₹6,930 price level has been observed, signalling a potential upward trend. Complementing this breakout, the Relative Strength Index (RSI) is still turning up, indicating increasing buying momentum. Given these technical indicators, traders can consider buying on dips, entering the stock at a lower price point. To manage risk, a stop loss at ₹6,850 is recommended. The target price for this strategy is ₹7,050 in the upcoming weeks, suggesting a potential gain as the stock continues its upward trajectory.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decision.
