Stocks to buy: The Indian stock market saw a significant sell-off on Thursday, May 30, coinciding with the expiry day of May futures and options (F&O) contracts. The Sensex concluded the session down by 617 points, marking a decrease of 0.83 percent, settling at 73,885.60. Meanwhile, the Nifty 50 wrapped up the day at 22,488.65, registering a decline of 216 points or 0.95 percent.
“Nifty index opened negative and dropped in the first tick itself which was followed by some range bound move in the first half of the session. The second half witnessed sustained weakness and it broke immediate support zones to touch low of 22417 levels. The last hour saw a quick recovery and it closed with losses of around 220 points. It formed a Bearish candle on daily scale and is forming lower highs from the last three sessions. Now till it holds below 22500 zones weakness could be seen towards 22350 then 22222 zones whereas hurdles can be seen at 22600 then 22750 zones,” said Chandan Taparia, Head – Equity Derivatives and Technicals, Broking and Distribution, MOFSL.
Meanwhile, India VIX was at 24.18 levels. Volatility spiked above 26 levels during the week and has caused discomfort to the bulls. VIX needs to fall below 16-18 zones for stability and a smoother ride in the market.
Since it is beginning of new series option data is scattered at various strike price. On weekly front, Maximum Call OI is at 23000 then 22800 strike while Maximum Put OI is at 22000 then 22500 strike. Minor Call writing is seen at 22500 then 22600 strike while minor Put writing is seen at 22400 then 22200 strike. Option data suggests a broader trading range in between 21800 to 23100 zones while an immediate range between 22100 to 22800 levels.
Bank Nifty
“Bank Nifty Index opened marginally lower but managed to hold 48250 zones and gradually extended the momentum towards 49044 marks in the latter part of the day. However it remained volatile in the last hour of the day but relatively outperformed the broader market and ended with some gains near 48700 zones. It formed a Bullish candle on daily scale and negated the formation of lower highs after three sessions. Now it has to continue to hold above 48500 zones for a bounce towards 49250 then 49500 zones while a hold the same could see some weakness towards 48250 then 48000 levels,” Taparia added.
Chandan Taparia has recommended three stocks to buy today, May 31. According to him, these stocks are technically placed to see a decent upmove. These three stocks to buy today include, Bharti Airtel, Dixon Technologies and RVNL.
Stocks to buy
Bharti Airtel: Buy at ₹1,377 | Target Price: ₹1450-1500 | Stop Loss: ₹1330
Bharti Airtel is in overall uptrend and holding gains at higher zones in spite of broader market weakness. It has retested breakout on daily chart and inched higher. It is forming higher highs from past six months and supports are gradually shifting higher.
Dixon Technologies: Buy at ₹9,308 | Target Price: ₹10,000 | Stop Loss: ₹9,000
Dixon is in overall uptrend and holding gains at higher zones. It has given consolidation breakout on daily scale and relatively outperforming within IT space. Momentum indicator RSI is positively placed which has bullish implications.
Also read: Wall Street today: US stocks slide after revised Q1 economy data, Treasury yields dip
RVNL Buy at ₹381| Target Price: ₹404 | Stop Loss: ₹370
RVNL is having a dream run as stock has rallied by almost 1000% in past 2 years. Buying is visible across Rail PSU stocks with surge in delivery and trading volumes which is supporting the up move. On monthly scale it is trending upwards and holding gains at higher levels. It has given range breakout on weekly chart and trading at life highs which implies strength in the stock. On daily scale decline is being bought into as buying is visible on dips. Overall chart setup indicates that momentum is likely to continue and stock is all set to test 500+ levels. Momentum indicator RSI is positively placed on monthly and weekly scale which may support the ongoing up move. It is holding well above all crucial moving averages which has bullish implications.
Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.
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Published: 30 May 2024, 08:59 PM IST
