Trade Call: 2 Technical Stock Picks By Sumeet Bagadia For Monday, 8th Jan

The benchmark Indian indices closed Friday on a flat note, following lacklustre global cues. The Sensex ended the day at 72,026.15, up 178.58 points, while the Nifty 50 settled the day at 21,710.80, up 52.20 points. Adani Ports, L&T, TCS, SBI Life Insurance, and LTIMindtree were the top gainers on the Nifty, while the worst-performing companies were JSW Steel, Britannia Industries, Kotak Mahindra Bank, Divi's Laboratories, and Nestle India. On the sectoral indices front, the IT sector was the top performer followed by auto and realty whereas the worst sector was PSU Bank followed by pharma and metal. Broader market indices S&P BSE Midcap and SmallCap ended on a flat note.

Nifty Outlook

Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities said, "Following a rapid rebound from its positional support at 21500, bullish activity has resumed in the market, with buying interest evident during dips. The prevailing sentiment is bullish, but Nifty encounters initial resistance at 21750, facing selling pressure. Immediate support rests at 21600. A conclusive close above 21750 levels could propel Nifty towards the 22000 mark, signalling further upward movement."

Bank Nifty Outlook

Exhibiting a robust recovery from the 47500 support level, Bank Nifty showcases active bullish activity, rebounding from the 14-day moving average support at 47800. A closing above 48200 is crucial, as it could propel the index towards 48500 and 48800 levels. The immediate support for Bank Nifty stands at 47800, indicating a key level to monitor in the current market scenario, stated Kunal Shah.

Stocks To Buy On Monday

For Monday, January 8, 2024, Sumeet Bagadia, executive director of Choice Broking, recommended buying two stocks. Here are Zydus Lifesciences' and Reliance Industries' entry price, stop loss, and target price.

Zydus Lifesciences

Buy ZYDUSLIFE in cash @ Rs 715, stop-loss @ Rs 695, target @ Rs 732

The current market status of the stock reveals a favourable position as it trades around 715 levels. An upward movement from the robust support at 700 levels has been observed, showcasing the stock's resilience. Furthermore, the stock is trading above crucial moving averages, including the short-term (20 Day), medium-term (50 Day), and long-term (200 Day) EMAs, signifying sustained strength.

Momentum is indicated by the RSI (Relative Strength Index), which is on an upward trajectory and currently stands at 72. This RSI movement reinforces the stock's inherent strength. A minor resistance around 717 levels is noteworthy, and a potential breakout beyond this level could propel the stock towards the target of 732 and beyond.

According to the aforementioned technical analysis, we advise buying ZYDUSLIFE at the CMP of 715 for the target of 732. If the stock closes below 695, our analysis will be invalid.

Reliance Industries

Buy RELIANCE in cash @ Rs 2607.70, stop-loss @ Rs 2565, target @ Rs 2685

Reliance Industries Limited (RELIANCE) is currently positioned at 2607.70 levels, reflecting a solid foundation established at the support level of 2565. The consolidation and base formation at this support level signify stability in the stock's performance. Additionally, RELIANCE exhibits resilience by trading above crucial moving averages, affirming its inherent strength.

While facing a minor resistance at 2635 levels, a breakout beyond this threshold could pave the way for further upward momentum. Sustaining levels above 2635 may propel the stock towards the next target at 2685 levels, presenting a promising outlook for investors.

Reinforcing the positive sentiment, the Relative Strength Index (RSI) comfortably rests at 68 levels, indicating a favourable balance between buying and selling pressures. The technical parameters collectively suggest a constructive environment for RELIANCE, encouraging potential bullish movements in the near term. Investors may find opportunities in this upward trajectory, particularly on confirmation of a sustained breakthrough above the resistance level.

Based on the above technical analysis we recommend buying RELIANCE at CMP of 2607.70 for a medium-term outlook with a stop loss of 2565 for targets of 2685.

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.