Vinay Rajani, an analyst at HDFC Securities, has come forward with his recommendations for top stocks to buy for both long and short-trading opportunities during turbulence in the Indian stock markets. His insights have touched upon specific actionable technical levels and resilient sectors against the weaker broader market trends.
Overview of the Market
- Current Trend: The Nifty is showing a bearish trend as it trades below the 5, 10, 20, 50, and 100-day exponential moving averages.
- Key Resistance Levels: 24,100 marks a critical resistance level. A decisive move above this could signal a trend reversal.
- Support Levels: 23,800 and 23,500 are decent entities of support, while the 200-day EMA at 23,500 could provide support if the sell-off happens to be steep.
Recommended Trades (Top Stocks to buy)
1. NMDC (Metals Sector) – Long Position
- Entry Fee: ₹230
- Stop Loss: ₹228
- Target Price: ₹240
- Rationale: NMDC has taken the lead in the metals space after breaking out of a channel pattern on the weekly chart. It indicates that there is a potential upside moment, even in case of broader market weakness.
2. BHEL [Capital Goods Sector] – Short Position
- Entry Fee: ₹ 230
- Stop Loss: ₹4
- Target Price: ₹220-222 (expected downside of 8-10 points)
- Rationale: The capital goods sectors, especially the stocks of BHEL, had been in a bearish trend. Rajani identifies BHEL to initiate a Short positional call since it has given a signal for the resumption of downtrend.
Reliance Industries: A special mention
- Current Price: 20% off its recent high
- Technical View: The technical analyst at Rajani recommends accumulation in Reliance on a staggered basis and not to sell in the name, especially nearing its previous swing levels around ₹1,270-₹1,280.
- Long-term Strategy: Reliance will remain a strong buy for long-term investors on account of its fundamental strength in the large-cap sector.
Key Levels to Watch
| Level | Description | Importance |
|---|---|---|
| 24,100 | Resistance | Potential trend reversal point |
| 23,800 | Support | Lower immediate support level |
| 23,500 | 200-Day EMA Support | Long-term support threshold |
Overview of Recommendations
- Long: NMDC in the metals sector, target ₹240.
- Short: BHEL in capital goods, target ₹220 – ₹222.
- Accumulate: Long-term investors rely on purchases that are made in phases.
Conclusion
In essence, Rajani’s recommendations are a tactical mix of long and short positions depending on market conditions. Investors taking a concentrated portfolio approach should focus on select stocks and sectors, tap into shorter-term opportunities in NMDC and BHEL, and look to longer-term opportunities by accumulating Reliance.
Disclaimer: The above recommendations are based on the current market conditions and technical analysis of Vinay Rajani. Keep in mind that stock markets are inherently volatile, and conditions may change in a very short span. Always consult a certified financial advisor before making any investment decisions. Note that this information is updated, higher, and subject to change when considering future market developments and risks.
Also, Read: This One Investment Secret Turned ₹12,000 Monthly into ₹1 Crore—Find Out How!