Stock market today: Trade setup for Nifty 50 and Sensex today; five stocks to buy or sell on Friday - August 9

Stock market today: Indian equity markets closed lower on Thursday. Nifty 50 closed 1.74 per cent lower at 24,117 points, compared to 24,297.50 points at the previous market close. The BSE Sensex also dipped 0.73 per cent to 78,886.22 points, compared to 79,468.01 points the previous day.

The Mid-cap index outperformed the Nifty 50, as the Nifty Midcap 50 closed 0.16 per cent lower, and the Nifty Small Cap 100 closed 0.41 per cent lower on Thursday.

Reserve Bank of India (RBI) Governor Shaktikanta Das announced the bi-monthly monetary policy on August 8 and decided to keep the key benchmark interest rates unchanged at 6.5 per cent. The central bank decided to stick with the “withdrawal of accommodation” policy, as inflation derived from food remains a key focus.

Trade Setup for Friday:

Srikant Chouhan, the Head of Equity Research at Kotak Securities shared his take on the equity markets and how investors should be careful of their strategy in a volatile market. Ajit Mishra, SVP of Research at Religare Broking, also highlighted that global uncertainty makes market participants cautious as he expects short-term relief to be unlikely.

“The benchmark indices witnessed a volatile trading session (on Thursday), after a roller coaster activity the Nifty ends 197 points lower while the Sensex was down by 582 points. Among Sectors, IT and Metal indices lost the most and shed over 1.5 percent whereas some buying was seen in selective Media and Pharma stocks,” said Shrikant Chouhan, Head Equity Research, Kotak Securities.

“Technically, market consistently facing selling pressure at higher levels. From the day's highest levels Nifty/ Sensex shed over 250/800 points. A bearish candle on daily charts and double top formation on intraday charts indicate further weakness from the current levels. For the day traders, intraday texture is non-directional and hence a level-based trading would be the ideal strategy,” said Chouhan.

“The ongoing global uncertainty is making market participants cautious, and short-term relief seems unlikely. The Nifty is encountering resistance around the 24,350 mark, and a decisive break below 23,900 could lead to a further decline. Traders are advised to adjust their positions with a hedged strategy to navigate the current volatility,” said Ajit Mishra, SVP of Research at Religare Broking.

Five stocks to buy or sell on Friday:

As we look at intraday stocks, equity market expert Sumeet Bagadia, Executive Director at Choice Broking and Ganesh Dongre, Senior Manager — Technical Research at Anand Rathi, recommends the following five stocks to buy today: Century Plyboards, Manappuram Finance, IndusInd Bank, Hindustan Unilever, and HDFC Life Insurance.

Sumeet Bagadia's stock recommendations today

1. Century Plyboards: Buy at ₹722.7, Target at ₹775, Stop loss at ₹697.

“Century Ply is currently trading at 722.7 and has rebounded from support levels around 680, which is near its long-term (200-day) EMA. This bounce back indicates stability and suggests potential for further upward movement. The stock has also recently broken out from a falling trend line and successfully retested the breakout levels, validating the strength of the breakout,” said Bagadia.

“The momentum indicator RSI has also rebounded and is currently at 55.80, supporting the bullish outlook. Additionally, Century Ply is trading above its short-term (20-day) EMA and all major moving averages, highlighting its strength and bullish sentiment,” he said.

“Given these technical indicators and overall market conditions, investors and traders might view this as a positive signal. A prudent strategy could involve buying the stock with a stop loss near the immediate support level of 697 and targeting higher levels of 775,” he said.

2. HDFC Life Insurance: Buy at ₹710.35, Target at ₹762, Stop loss at ₹684.

“HDFCLIFE is in a long-term uptrend, forming higher highs and higher lows on the daily time frame. The stock has recently experienced a pullback from its higher levels but has reversed from support areas, indicating that the bullish trend will continue. If the stock can hold above the ₹720 level on a closing basis, it is poised to move towards an upward target of ₹762 potentially,” said Bagadia.

“The Relative Strength Index (RSI) stands at 67.09 levels, indicating that the stock is not in an overbought condition and thus has room for further upward movement. Additionally, the stock has bounced from its short-term (20-day) Exponential Moving Average (EMA), signaling strong support at these levels,” he said.

“Given the current technical indicators and price action, HDFCLIFE appears well-positioned for a potential upward move. Investors should consider buying on dips, with a stop loss set at ₹684 to manage risk. The target price ₹762 aligns with resistance levels and offers a favorable risk-reward ratio, making this a promising trading opportunity,” said the market expert.

Ganesh Dongre's shares to buy today

3. Manappuram Finance: Buy at ₹198, Target at ₹205, Stop loss at ₹194.

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 ₹205. At present, the stock is maintaining a crucial support level at ₹194.

Given the current market price of ₹198, 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 ₹205.

4. IndusInd Bank: Buy at ₹1,348, Target at ₹1,380, Stop loss at ₹1,320.

On the daily chart of this stock, a breakout at the ₹1,348 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 of ₹1,320 is recommended. The target price for this strategy is ₹1,380 in the upcoming weeks, suggesting a potential gain as the stock continues its upward trajectory.

5. Hindustan Unilever: Buy at ₹2,735, Target at ₹2,800, Stop loss at ₹2,700.

On the short-term chart, this stock is forming a rounding bottom pattern, which is inherently bullish. Currently priced at ₹2,735, this formation signals a potential upward trend. To effectively manage risk, a stop loss at ₹2,700 is recommended.

The target price for this strategy is ₹2,800 in the upcoming weeks. This suggests a potential gain as the stock continues its upward trajectory, backed by the bullish technical signals.

Disclaimer: The views and recommendations above are those of individual analysts, experts, and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.