Stocks To Buy: 3 Technical Trade Picks By VLA Ambala On Thursday, 21st Dec

The financial markets are currently undergoing significant turmoil, influenced by a combination of factors ranging from the ongoing surge in Covid cases to geopolitical concerns and technical indicators. As of December 20, 2023, several noteworthy developments have unfolded.

The current market conditions are influenced by a confluence of factors, including the ongoing COVID-19 situation, geopolitical concerns, technical indicators, and profit booking. Investors are closely monitoring key support and resistance levels, and the outlook for the near future suggests a potential wide trading range with continued selling pressure. The assessment by V.L.A. Ambala underlines the importance of the 20-day EMA as a crucial level for Nifty and raises caution regarding the possibility of a substantial correction in Bank Nifty.

The surge in Covid cases has played a pivotal role in the recent downturn in the market. The heightened concerns over the virus and related fatalities have intensified the existing market pressures.

Rising geopolitical concerns, including issues with Canada on Khalistan and Azerbaijan on Pok, along with unsettling political cues such as the suspension of MPs, have created discomfort in democratic countries. This has prompted investors to prefer stable political environments.

Market Performance:

NIFTY experienced a 1.41% decline, trading in a wide range from 21593 to 21087. The MID Cap Nifty plummeted by 3.40%, erasing December 2023 profits. The Bank Index had a substantial trading range of almost 1000 points, closing 0.89% lower than the previous day, reflecting the impact of profit booking. Nifty IT was the only sector with marginal losses compared to the previous day, despite facing a three-day decline.

Profit booking is occurring as the market has peaked, following a 14% rise in the market over three months. A pullback was expected, exacerbated by intensified concerns over Covid cases and related fatalities. Further on technical aspects, A bearish double-top pattern at the market peak suggests a potential reversal. Additionally, the price, being 4% away from its 20-day EMA, indicates a divergence, which historically corrects after a one-sided rally. Nifty is currently trading near its "All-Time High" with an RSI of 85, and historical patterns suggest a tendency to fall when the daily RSI approaches this level.

Outlook for December 21, 2023

V.L.A. Ambala, a SEBI Registered Research Analyst and Co-Founder of Stock Market Today (SMT) anticipates key support and resistance levels for Nifty on December 21, 2023. The anticipated support is at 20750 and 20480, while resistance is identified at 21290 and 21400, indicating a potential wide trading range. Ms. VLA Ambala emphasizes the likelihood of continued selling pressure until the price reaches its 20-day EMA, approximately 46500 as of December 20, 2023. Bank Nifty, having experienced a 10% rise in just one month, could see up to a 33% correction, considering the typical price journey in the stock market.

Stocks To Buy

On Thursday, December 21, VLA Ambala, a SEBI Registered Research Analyst, released recommendations for intraday and swing trading in three companies.

HDFC Bank

Looking good to sell at 1650 and the target could be expected in the range of 1630 to 1615, setting a stop loss at 1665.

UltraTech Cement

Trading above its important levels and EMAs, indicating a negative bias. Consider selling in the range of 9900 and expect gains between 9800 and 9550. Place a stop loss at 10030.

Zee Entertainment Enterprises

ZEEL CMP is 252 and it's a very crucial range for it, indicating support buying possibilities (slightly risky). Consider buying in the range of 261 and expect gains between 300 and 320. Post-breakout place a stop loss at 215.

V.L.A. Ambala emphasizes that these recommendations are derived from price movement, historical behavior, and technical analysis.

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.