Trade Call: 2 Stock Picks By Sumeet Bagadia For 15th January, Monday

Domestic benchmark indices saw a record surge on Friday, with the Nifty reaching a new all-time high of 21928 levels during the session and closing with respectable gains of 247 points, or 1.1%, at 21894 levels. This was bolstered by a robust rally in the IT sector as well as better-than-expected Q3 earnings reported by the industry. On the other hand, throughout the session, the Sensex hit a record high of 72,720.96 and ended with a healthy gain of 847.27 points, or 1.18%, at 72,568.45.

In terms of sector performance, the IT sector led the way with a gain of 5.14%, followed by PSU Bank and the FMCG sector; the industries that struggled the most were the auto, power, and healthcare sectors. Top gainers were Infosys, ONGC, Tech Mahindra, LTIMindtree and TCS, while losers were Cipla, Apollo Hospitals, Power Grid Corporation, UltraTech Cement and Bajaj Finserv, on the Nifty pack.

Market Outlook

"Benchmark Index (Nifty) has not only ended the week at record levels but also given a bullish Flag and Pole Formation breakout on the daily chart which indicates an extension of the current underlying uptrend. As per the pattern, the target is 22,330. In BankNifty, a strong close above 48,250 is much needed to resume its bull run, and in the case of a breakout, the target comes to 49,000 (IDFC First Bank- On the verge of a triangle breakout, SBIN- completed pullback).

From the Auto sector, we continue to remain bullish on Hero Motocorp; however, several pockets are also strong but with an extremely overbought condition (Bajaj Auto and TVS Motors); buy on dips would be an ideal strategy," said Aditya Gaggar, Director of Progressive Shares.

"Consolidation of almost 2 years in Energy giant Reliance comes to an end with a Cup and Handle Formation breakout. Going forward, we expect that the stock will lead the sector as well as the Index rally. Not only the IT sector but almost all its components have also given a breakout from the bullish Flag and Pole Formation which suggests a continuation of the underlying uptrend.

With a hidden bullish divergence in RSI, a strong reversal can be anticipated in the PSU Banking space. We have a technical coverage on Bank of India & Union Bank of India and will stick with the same. Looking at the chart, it's better to cash in some profits from the Realty stocks as they are in an extremely overbought territory," added Aditya Gaggar.

Also read: Makar Sankranti Pick: Sumeet Bagadia Calls TECHM A Buy For TP of 1430/1500

Nifty Outlook

Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities said, "The Long-Short ratio, increased marginally to 63.36% on 11th January compared to 63.09% on 10th January as the Foreign Portfolio Investors (FPIs) liquidated some short positions in Index futures. Strong put writing (bulls' entry) was observed at 21,700 & 21,800 Strike in Nifty.

Strong put writing at a particular strike price is usually considered as a sign of resistance getting weaker. The bulls dethroned the bears from the 21,800 Strike in Nifty. The option activity at 22,000 Strike will provide cues about Nifty's Intraday direction on Monday. The resistance for Nifty shifts to 22,500 level from 21,800 level after today's close."

Also read: Weekly Technical Trade Call: 4 Stock Picks By Rajesh Palviya of Axis Securities

Bank Nifty Outlook

"Bank Nifty shrugged off its initial weakness and rose steadily throughout the day to close at 47,710, up 271 points. Heavy put writing (bulls' entry) at 47,500 Strike, led to an Intraday rise in Bank Nifty. The resistance for the Index now shifts to 48,000 level after today's close. The option activity at 47,500 level will provide cues about Bank Nifty's future direction," added Ashwin Ramani.

Also read: Trade Call: 3 Stock Picks By Chandan Taparia of Motilal Oswal On Monday, 15th Jan

Stocks To Buy

Sumeet Bagadia, executive director of Choice Broking, recommends purchasing two stocks on Monday, January 15, 2024. The entry price, stop loss, and target price for Sangam (India) and IDFC are as follows.

Sangam (India)

Buy SANGAMIND in Cash @ Rs 452.25, stop-loss: Rs 436, target: Rs 490

SANGAMIND, currently trading at 452.25 levels, showcases a robust technical posture by maintaining its position comfortably above the key 20-day, 50-day, and 200-day Exponential Moving Averages (EMA). The stock's recent consolidation within the 437-460 levels has set the stage for a potential upward movement, highlighted by higher highs and lower lows on the weekly charts.

A modest resistance zone at 460 levels presents a crucial juncture for SANGAMIND, and a successful breach could propel the stock towards the target of 490 levels and beyond. Investors should closely monitor the stock's performance around the resistance level, as it could dictate the sustainability of the positive momentum in the near term.

Based on this analysis, one may consider buying SANGAMIND at the CMP of 452.25, setting a stop loss at 436, and aiming for a target of 490.

IDFC

Buy IDFC LTD in Cash @ Rs 124.80, stop-loss: Rs 119, target: Rs 138

IDFC LTD is currently trading at Rs 124.80, having experienced a period of minor declines followed by sideways consolidation. The stock has found support at the 20-day Exponential Moving Average (EMA), indicating a potential for further upward movement, with a target of Rs 138. Significant support is observed near Rs 119 on the downside.

IDFC LTD is currently trading above key Exponential Moving Averages (EMAs), including the 20-day, 50-day, and 100-day EMAs. This suggests a robust bullish momentum, supporting the expectation of continued upward price action.

To manage risk effectively, it is advisable to set a stop-loss at Rs 119 to protect the investment. A prudent strategy involves considering buying opportunities during market dips.

Considering the technical analysis and prevailing market conditions, IDFC LTD presents a promising buying opportunity. With a target price of Rs 138, contingent upon implementing prudent risk management measures, this stock appears favorable for investors seeking potential gains in the current market environment.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.