Indian benchmark indices kicked off the week on a weak note and continued to fall on Monday on the back of intense sell-off, rise in the crude oil prices and escalating geopolitical concerns. BSE Sensex crashed 638.45 points or 0.78 per cent, to end the session at 81,050.00. NSE's Nifty50 tumbled 218.85 points, or 0.87 per cent, to close at 24,795.75 for the day.
Some buzzing stocks including Tata Power Company Ltd, Bharat Heavy Electricals Ltd (BHEL) and Suzlon Energy Ltd are likely to remain under the spotlight of traders for the session today. Here is what Jigar S Patel, Senior Manager - Technical Research at Anand Rathi Shares and Stock Brokers has to say on these stocks ahead of Tuesday's trading session:
Tata Power | Buy | Target Price: Rs 465 | Stop Loss: Rs 423
Tata Power showed signs of bullish strength by breaking out above the key resistance level of Rs 471. However, the stock failed to sustain this breakout and has since fallen back into its previous consolidation range, indicating that the breakout lacked strong follow-through momentum. This consolidation zone is now aligned with the flat Ichimoku Cloud and the 100-DEMA, both of which are recognized as significant support levels. These technical indicators suggest that the stock is likely to find a stable base here, providing a potential entry point for traders. Based on this analysis, we advise taking long positions in the price range of Rs 435-440, with an upside target of 465. To manage risk, a stop-loss should be set at Rs 423 on a daily closing basis.
Bharat Heavy Electricals | Avoid
At the current point in time, BHEL is trading near its 200-DEMA, a key technical indicator used to gauge long-term price trends. The fact that the stock is below the Ichimoku Cloud, which is another indicator that helps assess market trends and potential reversals, suggests a bearish or sluggish outlook for the stock in the upcoming sessions. This positioning below the cloud indicates that the price lacks upward momentum and could face continued selling pressure or consolidation in the short term. Additionally, on the indicator front, the Relative Strength Index (RSI), which measures the speed and change of price movements, has reversed from 55 and is currently sitting around 36. An RSI value below 40 often points to weakening momentum and signals that the stock is in a bearish phase. Given these technical factors, we recommend avoiding any new long positions and instead advise investors to use any short-term bounce in the stock’s price as an opportunity to book profits.
Suzlon Energy | Buy at Rs 66 | Target Price: Rs 76 | Stop Loss: Rs 61
Suzlon Energy exhibited a bearish divergence near the Rs 86 level, which indicates a potential reversal in price momentum. Following this divergence, the stock has corrected by approximately 17-18 per cent, pulling back to around Rs 71. At present, Suzlon is trading within the Ichimoku Cloud, an indicator used to identify potential support and resistance levels. The lower boundary of the cloud, which aligns with the 100-DEMA, is expected to provide strong support in the near term. Additionally, the RSI on the daily chart is approaching the oversold zone at 30, suggesting that the downward momentum may be weakening, potentially dragging the price towards the aforementioned support level. Given these factors, the support level of Rs 66 can be viewed as a potential entry point for a new position, targeting a move up to Rs 76. However, a stop-loss should be placed below 61 on a daily closing basis to manage risk effectively in case the stock breaks below support.