It was bloodbath at Dalal Street on Monday as Indian benchmark indices tumbled sharply lower during the trading session on the back of rising fears of recession in the US and geopolitical concerns in the middle east. BSE Sensex crashed 2,222.55 points, or 2.74 per cent, to end the day at 78,759.40. NSE's Nifty50 crumbled 662.10 points, or 2.68 per cent, to close at 24,055.60 for the day.
Some buzzing stocks namely Cipla Ltd, Tata Consumer Products Ltd and Borosil Renewables Ltd are likely to remain under the spotlight of traders for the session today. Here is what Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers has to say on these stocks ahead of Tuesday's trading session:
Cipla | Buy | Target Price: Rs 1,610| Stop Loss: Rs 1,460
Cipla has recently demonstrated a bullish signal by taking support at its previous breakout level of Rs 1,495 and is currently trading around Rs 1,515. This support level aligns with the stock's past resistance, indicating a potential strong foundation for further upward movement. On the technical front, the hourly relative strength index (RSI) has exhibited a hidden bullish divergence, a signal that often precedes price increases. Additionally, Cipla has taken support around the 50-day exponential moving average (50 DEMA) on the daily chart, adding another layer of bullish sentiment. Despite the broader market experiencing a significant downturn in the last trading session, Cipla showed resilience by maintaining its lower levels and recovering well. This strength against market trends makes it a promising buy. Given these factors, it is recommended to enter a long position in Cipla in the price range of 1500-1520, targeting a potential upside to Rs 1,610, with a stop-loss set at Rs 1,460 on a daily closing basis to manage risk.
Borosil Renewables | Buy | Target Price: Rs 575 | Stop Loss: Rs 475
Borosil Renewables has been in a consolidation phase, consistently trading above its 200-day exponential moving average (DEMA) around the Rs 480 mark for several months. This period of sideways movement indicated a phase of indecision or accumulation among market participants. Recently, however, the stock experienced a breakout from this range, signaling a potential shift in market sentiment and momentum. This breakout is further validated by a positive crossover of moving averages, suggesting increasing bullishness. Additionally, a chart pattern resembling an inverse head and shoulders has formed, which is typically considered a bullish reversal pattern. This combination of technical indicators suggests a strong potential for upward movement. Consequently, traders are recommended to buy it within the price range of Rs 500 to Rs 515, with a protective stop loss set at Rs 475 on a closing basis. The anticipated targets for this trade are Rs 575.
Tata Consumer Products | Buy | Target Price: Rs 1,270 | Stop Loss: Rs 1,155
In recent weeks, Tata Consumer has been consolidating within a price range of approximately Rs 1,160-1,130. This period of consolidation, where the stock price moves within a relatively narrow band, often precedes a significant price movement. True to this pattern, it has recently shown a decisive breakout, marked by substantial trading volume. This breakout suggests increased investor interest and confidence, indicating a potentially attractive buying opportunity at this juncture. From a technical analysis perspective, the daily relative strength Index (RSI) has reversed from the 50 level. This reversal is a positive sign, as the 50 level on the RSI often acts as a pivotal point, with a move upwards indicating strengthening momentum and a bullish outlook. The combination of the breakout and the RSI reversal suggests that the stock is poised for further gains. Based on these technical indicators, it is advisable to consider adding long positions in Tata Consumer within the Rs 1,185-1200 range. This range offers a strategic entry point, with the potential for the stock price to rise to the target of Rs 1,270, reflecting an attractive upside potential. To manage risk effectively, it is recommended to set a stop-loss at Rs 1,155 on a daily closing basis.
Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.