Nifty50: Day Trading Guide: 2 stock recommendations for Friday
Bears took control of Dalal Street, pushing the Nifty50 index down sharply, below the crucial 18,000 bar and the 20-DMA which acted as a stop loss line for the ongoing uptrend. Additionally, the overall index ended the October F&O series below 17,900 levels with a massive 354 point cut forming a large bearish candlestick indicating the reversal of the uptrend. Trade sustained below 17,900 over the next few trading sessions will trigger deeper corrections to levels of 17,730 to 17,600.
However, on the other hand, if the bulls manage to push Nifty50 above the 17,970 level, which is the previous pivot low point, will now act as resistance to the upside. A short cover rally could occur pushing the index up to the 18,120-18,200 levels. Additionally, in the event of a major correction, the 17,600-17,550 levels will be the key support area to watch out for, where a lower and 50-DMA group is placed and this can serve as a reversal point for this corrective move.
BUY at CMP Rs 652
Target: Rs 710
Stop Loss: Rs 615
The stock is on the verge of breaking out of a high consolidation range, suggesting that a resumption of the uptrend is on the cards. In addition, the RSI indicator also confirms the increase in the uptrend lately.
L&T Finance Holdings
SELL at CMP Rs 81.20
Target: Rs 74
Stop Loss: Rs 86
The stock resumed its downward trajectory after retesting the neckline of the channel failure indicating weakness. The RSI has also fallen below the 40 level, suggesting weakness.
(The author, Aditya Agarwala is Senior Technical Analyst at YES Securities. Opinions are her victory.)