Trade Call: 2 Stock Picks By Sumeet Bagadia of Choice Broking On Tuesday - April 2

Before trading in a range for the second half of the day to end at 22,462, up 135 points, Nifty began with a gap up and reached a new all-time high of 22,530. With an intraday decline of 5.84% the India VIX, closed at 12.08. The direction of the market will continue to be determined by macroeconomic events like bond yield movements, oil prices and the dollar index, the Q4FY24 earnings season, and pre-election cues.

Market Outlook

"The new financial year started on a cheerful note, with the benchmark index witnessing a gap-up start and sustenance at elevated levels. Across-board participation led to buoyancy, which was certainly visible in the technical setup. However, after inching into uncharted territory, the Nifty50 index showed some hesitancy and gradually slipped from the intraday highs by the day's end but managed to settle at positive terrain, gaining 0.61 percent from the last closure. The undertone clearly portrays bullish biases, with the advance-decline ratio strongly inclined in favor of the bulls. From a technical standpoint, the Nifty50 index has witnessed a small-bodied candle formation near the lifetime highs, indicating a sense of tentativeness in the benchmark, but the broader participation construes vigorous development," said Osho Krishan, Senior Research Analyst, Angel One.

"On the specific front, the 22500 mark is anticipated to act as a daunting task for the bulls, and an authoritative closure beyond the same could only trigger the next leg of the rally in the comparable period. On the lower end, 22350-22300 is expected to cushion any blip, followed by a strong support of 22200. And with the current setup, 'Buy on decline' should be the apt approach for market participants. While the undertone seems robust and the setup appears poised for the northward journey, the upcoming RBI monetary policy is likely to be watched closely as any significant developments are expected to act as a strong catalyst for setting up a near-term tone and trend. Simultaneously, traders are advised to stay prudent with the stock-centric approach and not be lured by the broader market action," Osho Krishan further added.

Nifty Outlook

"Both the call & put writers battled out at the 22,500 Strike in Nifty. The maximum Nifty call open interest (OI) is placed at the 22,500 Strike. The Bulls gave a scare to the Bears today at the 22,500 Strike but were unable to break through this level. The total OI on the call side at the 22,500 Strike is 1,53,492 contracts compared to 1,02,357 contracts on the put side. The option activity at this strike will provide cues about Nifty's future direction," said Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities.

"Technically, Nifty has continued to form higher highs and lower lows while staying above the 20-day short-term moving average. The weekly chart of the Nifty further supports the strength of this trend. The Donchian Channels which identify bullish and bearish extremes indicate Nifty is trading around the upper line with no strong deviations toward the upper or lower band, this points towards the fact that market is currently experiencing low volatility. The support level for Nifty has now shifted higher towards the 22,300 level while resistance stands around the 22,600-22,650 zone," Om Mehra, Technical Analyst, SAMCO Securities said.

Bank Nifty Outlook

"The Relative Strength Index (RSI) is currently holding the 60 level. The Index is trading above its 20-day moving average (DMA) with support near the 61.8% Fibonacci retracement level of around 47,250. Minor resistance is anticipated around 47,700; once this is surpassed, Bank Nifty may soon test the 48,000-48,100 level," added Om Mehra.

"Bank Nifty traded sideways after opening with a strong gap up and closed at 47,578, up 454 points. The 47,500 Strike saw a fierce battle between the call & put writers. The call writers (Bears) eventually managed to keep the put writers (Bulls) quiet throughout the day by keeping the pressure on them. The total OI on the call side at the 47,500 Strike is 1,57,224 contracts compared to 1,49,483 contracts on the put side The option activity at the 47,500 Strike will provide cues about Bank Nifty's upcoming direction," added Ashwin Ramani.

Stocks To Buy Today

Sumeet Bagadia, the executive director of Choice Broking, recommended buying or selling two stocks on Tuesday, April 2. The stocks' technical analyses are as follows.

Action Construction Equipment

Buy ACE in cash @ Rs 1606.4, Stop-loss @ Rs 1551, target @ Rs 1711

ACE is exhibiting strong bullish momentum, currently trading at an all-time high of 1635 levels. The recent breakout above the crucial resistance at 1480 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.

Additionally, ACE 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 70.94 levels.

For traders, keeping an eye on the strong support near the 1551 levels is advisable, as a breach of this level could signal a shift in sentiment. Overall, ACE 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 ACE and the CMP of 1606.4 with a stop loss of 1551 for the target of 1711.

Cochin Shipyard

Buy COCHINSHIP in cash @ Rs 968.3, stop-loss: Rs 944, target: Rs 1012

COCHINSHIP daily chart analysis reveals a notable shift in market dynamics, transitioning from a period of minor declines and sideways consolidation to a promising upside bounce. This breakout has been accompanied by a consolidation of the upward movement, characterized by Bullish Pattern. The strong bullish sentiment is further validated by a noticeable surge in trading volume.

Key technical indicators, particularly the Relative Strength Index (RSI), highlight the positive momentum in the stock. The RSI not only indicates favourable trends but also aligns with the stock trading above important moving averages, including the 20-day, 50-day, and 100-day Exponential Moving Averages (EMA). This convergence underscores the continued strength in COCHINSHIP price action.

In summary, the decisive breakout, along with encouraging volume and the positive alignment of key technical indicators, suggests a bullish outlook for COCHINSHIP. Traders and investors may interpret this analysis as indicative of potential sustained upward momentum in the stock.

Considering the above analysis, we recommend COCHINSHIP in cash at the current market price (CMP) of 968.3, setting a target of 1012, and implementing a stop loss at 944.

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.