Trade Call: Sumeet Bagadia Recommends 2 Stocks To Buy/Sell On Monday, Dec 4

On December 1, benchmark indices closed higher for the fourth straight day on favourable global cues, particularly the performance of the US markets. Nifty set an all-time high and gained 134.70 points, or 0.67 per cent to close at 20,267.90, while the Sensex surged 492.75 points or 0.74 per cent to settle at 67,481.19.

The Nifty's top gainers were Hero MotoCorp, HDFC Life, Wipro, M&M, and SBI Life Insurance, while the top losers were NTPC, ITC, L&T, Britannia Industries, and Axis Bank. The BSE SmallCap index gained 0.48% while the BSE Midcap index gained 0.96% on the broader market front.

Nifty Outlook

Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities said, "The Long-Short ratio moved from 10.88% on 26th October to 35.75% on 30th November as the Foreign Portfolio Investors (FPIs) increased their exposure to longs and trimmed their exposure to shorts in Index futures. The market's trajectory from the high of 20,222 recorded on September 15th to the low of 18,838 on October 26th spanned 26 trading sessions. Remarkably, the Nifty managed to not only retrace this entire fall but also surpass the previous all-time high within just 25 sessions.

This rapid recovery reveals a compelling narrative - the ascent outpaced the descent, indicating the enduring strength of the underlying bullish momentum. Strong put writing was seen at 20,200 Strike, which led to a sharp up move on Intraday basis. The near-term resistance for Nifty shifts to 20,400 level while the level of 20,200 is expected act as a strong support."

Commenting on the outlook of Nifty, Om Mehra, Technical Analyst, SAMCO Securities said, "The Donchian Channel, also referred to as the trend-following indicator and the tool for identifying bullish and bearish extremes, shows that the Nifty undertone remains bullish. Nifty is trading above all key moving averages and holds strong support around 20,000 levels. RSI is comfortable holding 74 levels, indicating overall strength.

According to the Fibonacci retrenchment, if the Index crosses 20,350 levels, we could expect the rally to extend to 20,550-20,620 levels in coming weeks. In contrast, the Bank Nifty finished the week at 44,814.20, up 2.39% from the previous week. A close above 45,100 would trigger further upswing."

Bank Nifty Outlook

Om Mehra, Technical Analyst, SAMCO Securities said, "Bank Nifty has strong support near 44,200 which corresponds to the 20 EMA. The immediate resistance level has been shifted to 45,600. After a three-month sell-off, FIIs turned net buyers, worth Rs. 3875.8 crore, while DIIs also bought Rs. 14,253.6 crore in the month of November."

Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities said, "Bank Nifty rose sharply throughout the day to end at 44,814, up 332 points. The level of 44,500, which acted as a strong resistance earlier, saw call writers exiting and strong put writing, leading to a strong up move in Bank Nifty. Both the call & put writers, however, battled out at the 45,000 Strike in the Index fiercely. The option activity at 45,000 level will provide cues about future direction of Bank Nifty."

Stocks To Buy This Week

Sumeet Bagadia, executive director of Choice Broking, suggested buying one IT and one auto stock on Monday, December 4. The following are TCS and Escorts Kubota's entry price, stop loss, and target price.

TCS

Buy TCS in Cash @ Rs 3511.65, stop-loss: Rs 3435, target: Rs 3650

Tata Consultancy Services (TCS) is currently trading at 3511.65 and the Chart suggests that TCS has established strong support near 3435 levels which is just below its 50-Day EMA level. This indicates that the stock has found considerable buying interest around these levels, providing a potential foundation for further upward movement. The Relative Strength Index (RSI) for TCS is currently at 56, indicating that there is still room for potential upside. The stock is trading above all the important moving averages indicating strength.

Considering the technical factors and market conditions, it appears to be a favourable opportunity to buy TCS at the CMP of 3511.65 levels. The target for this trade would be 3650, with a recommended stop loss set at 3435.

Escorts Kubota

Buy ESCORTS in cash @ Rs 3205.20, stop-loss: Rs 3135, target: Rs 3340

ESCORTS have bounced back from the strong support of 3140, which is also close to its 50-Day EMA and has given a breakout above a crucial resistance of 3200 levels. ESCORTS can climb upwards towards higher levels near 3340 levels as the current breakout is backed by the strong volumes.The fact that the RSI indicator is comfortably trading near 52 levels suggests that the present rebound can continue and that the stock may continue to rise.

With a medium-term goal price of 3340, we advise purchasing ESCORTS at the current market price of 3205.20. If the price closes below 3135, our analysis will be regarded as being invalid.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.