Trade Call: Sumeet Bagadia Recommends 2 Stocks To Buy/Sell On Monday, 18th Dec

This week's record high level of market mood was reached thanks to the US Fed's dovish remarks. On Friday, the domestic benchmark indices, Sensex and Nifty 50, maintained their upward trend and closed at record highs. Sensex surged 1,000 points beyond the 71,000 level, while Nifty broke the 21,450 barrier. On Friday, the Nifty climbed 1.29% to 21,456.70, while the Sensex surged 969.55 points to end at 71,483.75. HCL Tech, TCS, Infosys, SBI, and Tata Steel were the top 5 gainers on the Nifty, while HDFC Life Insurance Company, Nestle India, Bharti Airtel, Sbi Life Insurance Company, and Bajaj Auto were the top losers. On the broader market front, the BSE Mid-Cap index ended on a flat note whereas the small-cap index added 0.58%.

Weekly Market Outlook

"The overall trend of the market is positive but in the short run, it seems to be overheated and a meaningful correction will be healthy for the markets. Among the sectors, we continue to hold our bullish stance on the select Auto and Energy stocks (Eicher Motors, Hero Motocorp, and HPCL). From the Banking indices (BankNifty+PSU Banks), couple of stocks have experienced positive pattern breakouts (Bandhan Bank- Descending Channel Breakout, RBL Bank- Rounding Bottom Breakout, SBIN- Symmetrical Triangle Breakout).

As indicated in the previous weekly report, the IT sector performed on expected lines, giving a breakout and hinting towards a continuation of the current move (HCL Tech- Rounding Bottom Breakout). We are bullish on SAIL and NALCO as both of them have given a strong breakout from a Symmetrical Triangle and Falling Channel Formation respectively. The technical development in Chemical stocks indicates that the bottom has been placed and is all set to realign with its primary uptrend (Gujarat Fluorochemicals, SRF- Symmetrical Triangle Breakout, Sudarshan Chemicals- Flag and Pole Breakout)," said Mr. Aditya Gaggar, Director of Progressive Shares.

Nifty Outlook

Rupak De, Senior Technical analyst at LKP Securities said, "The Nifty's upward momentum persists with the bulls maintaining control in the market. Achieving a new all-time high, the index has marked its seventh consecutive weekly gain. The prevailing sentiment appears strongly in favor of the bulls, as indicated by the absence of any reversal signals on the technical charts. Resistance is observed at 21,500, while a potential further rally in the Nifty could occur upon breaching this level. Support is currently positioned at 21,300."

Bank Nifty Outlook

Kunal Shah, Senior Technical & Derivative analyst at LKP Securities said, "The Bank Nifty bulls maintain their robust momentum, pushing the index beyond the 48000 level. The overall market sentiment remains bullish, supported by a strong base at 47500. Any retracements towards this support level are seen as buying opportunities. The upside potential for the index is projected to reach 50000, indicating continued optimism among market participants."

Stocks To Buy On Monday

The executive director of Choice Broking, Sumeet Bagadia, suggested buying two stocks on Monday, December 18. The entry price, stop loss, and target price for Reliance Industries and Info Edge (India) are listed here.

Info Edge (India)

Buy NAUKRI in cash @ Rs 5220, stop-loss @ Rs 5060, target @ Rs 5545

NAUKRI, currently trading at Rs 5220, has recently broken out above Rs 5000 and formed a rounding bottom pattern breakout on the daily chart. The immediate resistance is near the Rs 5400 level, and the current price is exhibiting strong bullish momentum, expected to continue towards the Rs 5545 level. On the flip side, there is strong support near Rs 5060.

Moreover, NAUKRI is trading above key Exponential Moving Averages (EMAs), including the 20-day, 50-day, 100-day, and 200-day EMAs, indicating robust bullish momentum and suggesting potential for further upward price movement. The Relative Strength Index (RSI) is presently at 75.8, showing an upward trajectory and indicating increasing buying momentum. Additionally, the Stochastic Relative Strength Index (Stoch RSI) exhibits a positive crossover. These technical indicators collectively suggest that NAUKRI may have the potential to reach a target price of Rs 5545 in the near term.

To manage risk effectively, it is advisable to set a stop-loss (SL) at Rs 5060 to safeguard the investment in the event of an unexpected market turn. A prudent strategy would be to consider buying on dips at levels of Rs 5150 and Rs 5000.

Overall, considering the technical analysis and current market conditions, NAUKRI presents a promising buying opportunity for those aiming for a Rs 5545 price target, provided that prudent risk management measures are in place.

Reliance Industries

Buy RELIANCE in cash @ Rs 2495.60, stop-loss @ Rs 2440, target @ Rs 2600

RELIANCE is currently trading at 2495.60 levels. The stock has strong support at 2400 levels where stock has consolidated and has formed a base. We can also witness small resistance near 2540 levels. Once stock maintains a higher level than 2540, it may advance upward and approach the 2600 level. Also, the stock is trading above all the important moving averages indicating strength. The RSI indicator is comfortably trading at 70 levels.

Based on the above technical analysis we recommend buying RELIANCE at CMP of 2495.60 for a medium-term outlook with a stop loss of 2440 for targets of 2600.

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.