Day Trading Guide: 2 stock recommendations for Monday

Nifty ended positively for the sixth consecutive month. This month, however, Nifty moved volatile wherein after marking a record high at 18,604, a sudden change in the sentiment dragged the index lower till 17,613. On a monthly basis, Nifty posted minor gains of 0.3%, though it settled below September’s high.

Following Thursday’s large bearish candle, Nifty formed another bearish candle on Friday. Nifty retraced almost 1/3 (i.e. 33%) of its July-Oct up move, moreover 50-day average (near 17,570) levels are intact since mid May’21 on a closing basis. Hence, the immediate floor is seen near 17,600-17,550 zone and sustenance above the same is required for mild consolidation or recovery to set in.

On a monthly closing, Bank Nifty outperformed the benchmark index. Bank Nifty rose ~4.5%, up for the third straight month. This week Bank Nifty lost 8% from the record high. Mild consolidation is plausible with immediate hurdle seen near 40,400 zone.

Recommendations:


Buy Tata Consumer Products near Rs 810

Stop loss: Rs 775

Target: Rs 880
After losing 13% from its record high, momentum on the downside stalled near 100-day EMA. Mild recovery thereafter is holding levels of Rs 800. Sustenance could lift the stock towards Rs 880 zone.

Buy

near Rs 496-500

Stop loss: Rs 482

Target: Rs 540

Series of ascending tops and bottoms is intact, sustenance above important averages is likely to keep the outlook positive.

(The author, Amit Trivedi, CMT, is Technical Analyst – Institutional Equities, YES Securities. Views are his own)