Adani Wilmar, Tata Power, Hindalco: What should be your strategy amid market volatility

Domestic stock indices snapped the two-day losing streak on Wednesday to end higher, thanks to an in line policy RBI outcome. The BSE Sensex jumped 377.75 points, or 0.63 per cent, to settle 60,663.79. The Nifty gained 150.20 points, or 0.85 per cent, to 17,871.70.

Select stocks such as Adani Wilmar, Tata Power and Hindalco Industries were on traders' radar. Here is what Laxmikant Shukla, Technical Research Analyst at YES Securities has to say on these stocks during for Thursday's trading session:

Adani Wilmar | Avoid | Resistance: Rs 500 | Support: Rs 380

Adani Wilmar stock has witnessed swift erosion in value following the Hindenburg research. The scrip has fallen more than 35 per cent from the recent high. The sharp correction has led prices to push towards its prior multi-month support zone of Rs 380-360 levels. The daily RSI is bouncing back from oversold zone and a pullback cannot be ruled out.  On the way up, the stock can face resistance near Rs 490-500 levels. Due to huge amount of volatility, one should avoid trading in the scrip till it gets stabilise at the prevailing levels.

Tata Power | Range-bound | Resistance: Rs 220 | Support: Rs 194

Tata Power remained confined within the broader range of Rs 220 -194 levels in last few weeks. The occurrence of a series of Doji candlestick pattern with the stock price staying within 100- and 20-DMAs indicate a range squeeze and a breakout or breakdown from the range is likely soon. A breakout above Rs 220 would lead prices towards Rs 250 levels. While breaching below the Rs 194 level could induce selling pressure towards Rs 164-160 levels on the downside.

Hindalco | Sell | Target: Rs 420 and Rs 400 | Stop Loss: Rs 480

Hindalco Industries has broken out of a rising wedge formation on the weekly chart. It also has been maintaining a lower top-lower bottom formation since the last three weeks.  The inclining peak of histogram below zero reference line also highlighted negative sentiment for the scrip. That said, the daily strength indicator RSI rebounded from oversold zone, suggesting a pullback. At current levels, we may see pullback towards Rs 455-450 levels, where the stock could face a stiff resistance. One can look at sell opportunity around the mentioned zone for the downside target of Rs 420 and Rs 400 levels, with a stop loss placed at Rs 480 on a closing basis.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Business Today)

 

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