Trade Setup: Ruchit Jain of 5paisa.com Recommends 3 Stocks To Buy On Monday

Nifty began the last week on a positive note with expectations of setting a new record high. The benchmark index dropped 1.01% for the week, reaching just above 18750. Although the Sensex reached the 63,601 mark on Thursday last week, the Nifty narrowly missed making the high after witnessing some correction from the high in the last couple of sessions. The Indian stock market dropped for a second straight day on Friday as a result of a weak global cue triggered by a hawkish US Fed. The NSE Nifty 50 Index ended 106 points or 0.56% lower at 18,665.50 while the S&P BSE Sensex Index ended the day down 260 points or 0.41% at 62,979.37. The S&P BSE MidCap Index fell by 1.24%, while the S&P BSE SmallCap Index fell by 1.17%.

Market Outlook

Ruchit Jain, lead research analyst at 5paisa.com said Nifty resisted around the previous high around 18880 and witnessed some profit booking towards the end. The index has ended the week right around its '20 DEMA' support which is placed around 18650. This average has acted as a support for Nifty in this entire up move since the start of April and thus, it will be crucial to see if the index breaks that. In such a case, we can expect some price-wise correction towards the next support which will be seen in the range of 18500-18450. On the flip side, a breakout above 18880-18900 will lead to a resumption of the uptrend. The Bank Nifty index continued its consolidation phase and resisted around the 44000-44100 range throughout the week. This index has already been going through a time-wise corrective phase as it has consolidated in range for this entire month so far. While the PSU Banks are trading around its crucial 89 EMA, the private sector heavyweights such as HDFC Bank and ICICI Bank have already corrected and are trading around supports. Thus, the private sector heavyweights could play a pivotal role in driving the momentum in the banking index. One can look to form long positions above 44100 as that would confirm a resumption of the uptrend in this space.

The Midcap stocks witnessed some profit booking in the last couple of sessions. However, this was much expected as the momentum readings on the Nifty Midcap100 index were highly overbought. The readings have started to cool off and thus, one should avoid chasing the stocks at higher levels and rather look for buying opportunities on declines when they approach the support zones, said Ruchit Jain.

Stocks To Buy On Monday, 26th June

Ruchit Jain has recommended 3 stocks to buy on Monday, the details are listed out below.

Bharti Airtel

Stock is forming a 'Higher Top Higher Bottom' structure and is in an uptrend. The price volume structure indicates the possibility of the continuation of an uptrend. Traders can buy in the range of Rs. 855-850 with a stoploss below Rs. 826 for short-term targets of Rs. 885 and Rs. 905.

Century Enka

The stock has given a breakout from a consolidation phase. The 20 DEMA is acting as a support while RSI is indicating a positive momentum. Traders can buy in a range of Rs. 435-430 with a stoploss below Rs. 415 for short-term targets of Rs. 455 and Rs. 470.

United Spirits

Stock is showing relative strength in the corrective phase of the market. Prices are trading above the 20 DEMA support for almost three months which is seen as important support. Traders can buy in a range of Rs. 910-900 with a stoploss below Rs. 870 for short-term targets of Rs. 945 and Rs. 980.

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.