Buy or Sell: Sumeet Bagadia recommends three stocks to buy on Monday, December 23, 2024

Buy or sell shares: Following the US Fed’s aggressive outlook on interest rate cuts and selling of financial instruments, the Indian stock market broke its four-week winning streak. Major benchmark indices have wiped out their four-week gains over the past week. The Nifty 50 index fell to 23,587 from 23,768, with a weekly loss of 1,181 points. The BSE Sensex crashed from 82,133 to 78,041 levels, registering a loss of over 4,000 points last week. Similarly, the Nifty Bank index crashed from 53,583 to 50,759, with a weekly loss of 2,824 points last week.

During this stock market crash, the Nifty 50 index broke below the 200-DEMA support and settled at 23,800, which may have boosted the morale of the Indian stock markets. 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 sacred or the 50-share index will hit a new low.

Buy or sell shares for next week

Sumeet Bagadia, executive director at Choice Broking, believes that the overall bias in the Indian stock market has softened as the Nifty 50 index has fallen below the 200-DEMA support of 23,800 on a closing basis. The Choice Broking expert said investors should remain extra cautious as the 50-share index could try to move near the recent lower limit of 23,250. Bagadia noted that the market could see extensive selling if the frontline index breaks below 23,250. However, in case of a trend reversal, Nifty may face a strong hurdle at the 23,800 mark. A bullish or bearish trend can be assumed when breaking either side of the current range.

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

Stocks to buy on Monday

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

Titan’s share price is showing some signs of recovery, but is still in a downward trend. Currently priced around ₹3356.25, The recent rise in support levels at ₹3200 follows a long decline, suggesting the situation could improve if more buyers continue to support the stock.

Titan’s stock price is still trading below its major moving averages: the 20-day EMA, 50-day EMA, and the 100-day EMA. If the price is below these levels, it usually indicates a bearish trend, but if the stock closes above them, it could signal the start of a reversal. 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 move higher if it stays below these points.

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

2]Petronet LNG: Buy from ₹336.45, goal ₹355, stop loss ₹323.

Petronet LNG’s share price is currently trading around ₹336.45, recently rebounded from support nearby ₹320, close to the 200 day EMA. This indicates that the stock is able to maintain stability at these levels. The recent price action suggests that the stock has established a support zone ₹330, with ₹320 as a critical support level on the downside. On the plus side, ₹340 emerges as an immediate resistance level. A persistent upward movement ₹340 could create 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, indicating moderate strength without being overbought. Overall, the Petronet LNG stock trend is sideways to bullish, supported by several technical indicators, reinforcing the positive sentiment.

Consider buying on CMP, especially around ₹336.45, to take advantage of potential price retracements. Implement a stop-loss at ₹323 is advisable to effectively manage risks and protect investments against unexpected market shifts.

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

The stock price of Dr. Reddy’s Laboratories is currently trading at ₹1343.65, which shows a notable uptrend from the current support levels ₹1280, near its 20-day exponential moving average (EMA). The stock’s positive momentum is further confirmed by its positioning above the short-term (20 days), medium-term (50 days) and long-term (200 days) EMA levels, reinforcing its technical resilience.

A significant break above resistance at 1370, supported by robust volumes, underlines the strength of the stock, which also marks its all-time high. A breakout above this crucial resistance could pave the way for a rally towards the target ₹1425 in the short term. Traders and investors who entered at lower levels are advised to safeguard their positions by keeping stop losses close ₹1295, aimed at ₹1425 and after.

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

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