Indian benchmark indices settled sharply lower on Friday amid the expiry of the November series F&O contracts. After a strong start for the week, feeble global cues dented the sentiments for Dalal Street. BSE Sensex tanked 1,190.34 points or 1.48 cent to end the session at 79,043.74. NSE's Nifty50 plunged 360.75 points or 1.49 per cent, to settle at 23,914.15 for the day.
Some buzzing stocks including Larsen & Toubro Ltd (L&T), ABB India Ltd and Bharat Heavy Electricals Ltd (BHEL) are likely to remain under the spotlight of traders for the session today. Here is what Kushal Gandhi, Technical Analyst at StoxBox has to say on these stocks ahead of Friday's trading session:
Larsen & Toubro | Buy | Target Price: Rs 3,950 | Stop Loss: Rs 3,547
The share price of L&T has been moving sideways within a broader range of 19 per cent, suggesting potential accumulation that may lead to the continuation of its primary trend. The latter part of the consolidation phase appears to be forming a cup and handle pattern, and a bullish breakout would further confirm the validity of the trend reversal. The stock has reclaimed the 50-day moving average on relatively higher volume, which is now expected to serve as immediate support, thus providing a favorable risk-to-reward ratio. The RSI, measured across daily and higher timeframes, is trading well above the median without showing any divergence from the price, indicating the buildup of bullish price momentum. We recommend purchasing shares of L&T within the range of Rs 3670-3620, with a target price of Rs 3,950, while maintaining a stop loss at Rs 3,547.
ABB India | Avoid
The share price of ABB recently experienced a decline due to profit booking and has corrected by 26 per cent from the highs observed in October. Price action found immediate support at its 50-week moving average, demonstrating resilience against further pullbacks and showing signs of a slight recovery. The stock has reclaimed its 200 DMA and is currently trading around Rs 7,305, with the Rs 7,307-7,100 range identified as a critical support zone. Maintaining levels above this range will be essential to limit potential drawdowns. Immediate overhead resistance is located at 50 DMA near Rs 7,696, and the stock is expected to attract additional bullish momentum upon decisively closing above this average line. Until that occurs, we recommend refraining from purchasing shares of ABB.
Bharat Heavy Electricals | Buy | Target Price: Rs 275 | Stop Loss: Rs 240
The share price of BHEL has been on a corrective trend. However, the stock is now displaying potential signs of a trend reversal, indicated by the formation of a double bottom breakout. Today, the price action experienced a breakout, accompanied by a mild gap up, which validates the strength of this breakout. This is a positive development, and the stock has also reclaimed its 50-DMA. The recent recovery in price from the lows has been supported by an improving RSI, suggesting that bullish momentum is building. Additionally, there is noticeable improvement in buyer demand. Therefore, we recommend purchasing shares of BHEL for a short-term opportunity, aiming for a target price of Rs 275, while maintaining a stop loss at Rs 240.