Buy or sell: Sumeet Bagadia recommends three stocks to buy on Monday — 23 December 2024

Buy or sell stocks: Following the hawkish US Fed outlook on the interest rate cut and FIIs’ selling, the Indian stock market snapped its four-week winning streak. The key benchmark indices erased their four-week gains in the week gone by. The Nifty 50 index slipped from 23,768 to 23,587, logging a weekly loss of 1,181 points. The BSE Sensex crashed from 82,133 to 78,041 levels, recording over 4,000 points loss last week. Likewise, the Nifty Bank index crashed from 53,583 to 50,759, logging a weekly loss of 2,824 points last week.

In this stock market crash, the Nifty 50 index broke below its 200-DEMA support, placing at 23,800, which may have boosted the morale of Indian stock market bears. In this bear-hit market, the Nifty 50 index is close to its recent swing low of 23,250, and bets are high on whether this support will remain sacrosanct or the 50-stock Index will touch a new low.

Buy or sell stocks for next week

Sumeet Bagadia, Executive Director at Choice Broking, believes that overall Indian stock market bias has weakened as the Nifty 50 index has slipped below 200-DEMA support of 23,800 on a closing basis. The Choice Broking expert said that investors must remain extra cautious as the 50-stock Index may try to come close to its recent swing lower range of 23,250. Bagadia noted that the market may sell extensively if the frontline index breaks below 23,250. However, in the case of a trend reversal, Nifty may face a strong hurdle at the 23,800 mark. A bullish or bearish trend can be assumed on the breakage of either side of the current range.

Regarding bull or sell stocks for Monday, Sumeet Bagadia recommended buying these three shares: Titan Company, Petronet LNG, and Dr Reddy’s Laboratories.

Stocks to buy on Monday

1] Titan Company: Buy at ₹3356.25, target ₹3555, stop loss ₹3222.

The Titan share price shows some signs of recovery, but it’s still in a downtrend. Currently priced around ₹3356.25, The recent rise from the support levels at ₹3200 follows a long decline, hinting that things could improve if more buyers continue to support the stock.

Titan’s share price is still trading below its major moving averages: the 20-day EMA, 50-day EMA and the 100-day EMA. Being below these levels usually signals a bearish trend, but if the stock closes above them, it might show the beginning of a turnaround. A close above the 20-day EMA would be a positive sign, and crossing the 50-day EMA would further strengthen this. However, the stock may struggle to go higher if it stays below these points.

The recent low of around ₹3200 is a support level for some buyers. If Titan’s share falls below this support, it could continue its downtrend. But if it breaks above the resistance at the 20-day and 50-day EMAs, it might move toward ₹3500, which would be a more substantial recovery sign. A suggested stop loss (SL) could be placed at ₹3222 to limit downside risk, while the target is set at ₹3555 for further movement.

2] Petronet LNG: Buy at ₹336.45, target ₹355, stop loss ₹323.

Petronet LNG share price is currently trading around ₹336.45, having recently bounced back from support near ₹320, close to its 200-day EMA. This indicates the stock’s ability to maintain stability at these levels. The recent price action suggests that the stock has established a support zone around ₹330, with ₹320 as a critical support level on the downside. On the upside, ₹340 emerges as an immediate resistance level. A sustained move above ₹340 could trigger bullish momentum, potentially leading to higher levels towards the target of ₹355 after a consolidation phase.

The Relative Strength Index (RSI) stands at 51.28, suggesting moderate strength without reaching overbought conditions. Overall, the Petronet LNG share trend is sideways to bullish, supported by various technical indicators, reinforcing a positive sentiment.

Consider buying on CMP, particularly around ₹336.45, to capitalise on potential price retracements. Implementing a stop-loss at ₹323 is advisable to manage risks effectively, safeguarding investments against unexpected market shifts.

3] Dr Reddy’s Laboratories: Buy at ₹1343.65, target ₹1425, stop loss ₹1295.

Dr Reddy’s Laboratories share price is currently trading at ₹1343.65, showcasing a notable uptrend from the support levels around ₹1280, in close proximity to its 20-Day Exponential Moving Average (EMA). The stock’s positive momentum is further confirmed by its positioning above the short-term (20-day), medium-term (50-day), and long-term (200-day) EMA levels, reinforcing its technical resilience.

A significant breakthrough above the resistance at 1370, supported by robust volumes, underscores the stock’s strength, which also marks its all-time high. A breakout above this crucial resistance could set the stage for a rally towards the target of ₹1425 in the short term. Traders and investors who entered at lower levels are advised to safeguard their positions by trailing stop losses near ₹1295, aiming for ₹1425 and beyond.

The momentum indicator, Relative Strength Index (RSI), is currently at 69.74 levels, indicating positive momentum in the stock. For those considering fresh investments, purchasing at the current market price (CMP) is a viable option, targeting ₹1425, with a stringent stop loss set at ₹1295 levels to manage risk effectively.

Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.