Trade Call: Sumeet Bagadia Recommends 2 Stocks To Buy/Sell On Wednesday, Dec 6

Nifty continued its bullish trend, marking gains for the sixth consecutive day on Tuesday on the back of strong rally in the Metals, Banking, Oil & Gas and Consumer Durables sectors. Nifty surged 168.30 points or 0.81 per cent to close at 20,855.10, while the Sensex gained 431.02 points or 0.63 per cent to settle at 69,296.14.

Adani Enterprises, Adani Ports, Power Grid Corporation, NTPC, and SBI were the top gainers on the Nifty, while LTIMindtree, HCL Technologies, Divis Labs, HUL, and Bajaj Auto were the top losers. On the broader market front, BSE midcap and Smallcap indices ended on a flat note.

Market Outlook Today

"Extending its positive momentum, Indian equities started the day at another record level of 20,800. Due to the overbought condition, a knee-jerk reaction was observed in the mid-session followed by a swift recovery, and for the rest of the day, the Index remained range bound.

Nifty50 advanced by 168.30 points and settled at 20,855.10. A mixed activity was seen among the sectors with Energy and Metal being the outperformers while Media and IT ended in red. Mid and Small Caps continued to underperform as major buying influx was seen in the Index stocks only.

With an overbought condition, it appears that the Index has formed a Hanging Man candlestick pattern. We may see a price or time-wise correction and in the case of a price-wise correction, a reversal of the trend will only be confirmed when it closes below 20,700," said Aditya Gaggar Director of Progressive Shares.

Nifty Outlook Today

Rupak De, Senior Technical analyst at LKP Securities said, "Nifty has continued its upward momentum, marking gains for the sixth consecutive day. The prevailing trend stays positive, supported by the critical moving average. The RSI's bullish crossover signifies a positive momentum. Towards higher levels, Nifty faces resistance at 21000, a zone where significant call writers have positioned themselves. Conversely, support is situated at 20700 on the lower end."

Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities said, "Nifty shrugged off its initial weakness and rose steadily throughout the day to close 168 points higher at 20,855. The Long-Short Ratio has risen from 35.75% on 30th November to 44.44% on 4th December as the Foreign Portfolio Investors (FPIs) increased their exposure to longs in Index futures.

The Futures Open Interest (OI) indicated buildup of fresh long positions in Nifty futures for the second consecutive day. Call writers exited from the 20,700 Strike in Nifty, which led to the steady up move in Nifty today. Nifty has formed a hanging man candle on the daily chart. The maximum call open interest is placed at 21,000 Strike and move beyond 21,000 level is unlikely unless call writers exit from 21,000 Strike in Nifty."

Bank Nifty Outlook Today

Kunal Shah, Senior Technical & Derivative analyst at LKP Securities stated, "The Bank Nifty index maintained its robust buying momentum, although it formed a doji candle on the daily chart, suggesting a potential pause in the uptrend. A decisive breakout above 47100, sustained over time, could propel the index toward 47500 levels, indicating further upward momentum. The lower-end support has shifted to 46400, serving as a crucial cushion for the bulls in case of any retracement."

"Bank Nifty gave a higher close for the third consecutive day to close 581 points higher at 47,012. Put writers were seen creating pressure on the call writers at the maximum call open interest strike of 47,000 in Bank Nifty. The option activity at 47,000 Strike will provide cues about future direction of Bank Nifty," said Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities.

Stocks To Buy Today

The executive director of Choice Broking, Sumeet Bagadia, suggested buying two stocks on Wednesday, December 6. For Axis Bank and Aditya Birla Fashion and Retail, the entry price, stop loss, and target price are listed below.

Axis Bank

Buy AXISBANK in Cash @ Rs 1000, stop-loss: Rs 980, target: Rs 1040

Axis Bank is currently trading at 1000. The chart suggests that Axis Bank has established a robust support level in the range of 970-980 levels, coinciding with the 50 and 20-day Exponential Moving Averages (EMA).

On the daily scale, the stock has formed an inverse head and shoulders pattern breakout with substantial volume, indicating strong buying interest around these levels. The Relative Strength Index (RSI) for Axis Bank is currently at 62, suggesting room for potential upside. Additionally, the Stochastic RSI also shows a positive crossover, further supporting the bullish sentiment.The stock is trading above all significant moving averages, indicating its strength.

Considering these technical factors and market conditions, it appears to be a favorable opportunity to buy Axis Bank at the current market price of 1000 levels. The target for this trade would be 1040, with a recommended stop-loss set at 980.

Aditya Birla Fashion and Retail

Buy ABFRL in cash @ Rs 240.40, stop-loss: Rs 234, target: Rs 252.

The stock in question has exhibited strong technical signals, rebounding convincingly from a significant support level at 235, which previously acted as resistance, indicating a notable shift in market sentiment. Currently trading above the 20-Day, 50-Day, and 200-Day Exponential Moving Averages, the stock reflects positive momentum across different timeframes.

The weekly chart reveals a compelling trend with three consecutive weeks of higher highs and higher lows, accompanied by the bullish Three Rising Soldiers candlestick pattern, affirming the stock's underlying strength. The weekly Relative Strength Index (RSI) at 61 further supports the bullish narrative, signifying positive momentum without entering overbought territory. Investors may find these technical indicators promising, but a comprehensive analysis, including fundamental factors, is crucial to inform well-rounded investment decisions amidst dynamic market conditions.

Based on the above analysis we recommend buying ABFRL with a medium term outlook at CMP of 240.40 with a SL of 234 for a target price of 252.

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.