Home / Markets / Stock Markets /  Day trading guide for Wednesday: 4 stocks to buy or sell today — 28 September

Day trading guide for Wednesday: Following bouts of buying and selling, Indian stock market continued its corrective phase with a gap down close on Tuesday session. Nifty 50 index finished 9 points lower at 17,007, BSE Sensex shed 37 points and closed at 57,107 whereas Nifty Bank index lost 257 points and ended at 38,359 levels. Among sectors oil & gas, telecom and IT were the main gainers while power, metals and banks were the main losers. Small-cap index outperformed rising 0.49 per cent even as the advance decline ratio improved to 1.37:1.

According to stock market experts, a reasonable negative candle was formed on the daily chart, that has placed beside the similar negative candle of previous session. Technically, this pattern signal broader range bound action in the market with weak bias. This pattern also indicates a lack of strength in the intraday upside bounce. This is not a good sign and one may expect further weakness in the short term.

Stock market today: Day trading strategies for Nifty, Bank Nifty

Speaking on Nifty 50 index, Nagaraj Shetti, Technical Research Analyst at HDFC Securities said, "Nifty is temporarily halting its weakness near the crucial lower support of 16,800 levels, as per the concept of change in polarity. The area of 16,800 has acted as an important value area and has resulted in significant movement from its support/resistance/breakouts in the past. Hence, having declined swiftly from the highs of 18,000 mark this time, there is a possibility of a sustainable upside bounce in the market from near this support. Immediate resistance for NSE Nifty is placed around 17,150 to 17,200 levels."

Advising traders to stay cautious from a short term perspective, Ruchit Jain, Lead Research at 5paisa.com said, "The rise in the Dollar Index since last week and a sharp depreciation in INR have been the prime reasons for the sharp fall in Nifty. FII’s have formed more short positions in the index futures segment and they have been selling in the cash segment too. Until we see any reversal in the above data, the equities will continue to witness selling pressure and this decline from the high of 18100 seems to be an impulsive decline which is not completed yet. So the short term trend continues to be negative and hence, we continue with our advice for traders to stay cautious from a short term perspective."

"RSI oscillator on the daily chart continues to show a negative momentum but is approaching the oversold zone on the lower time frame charts. Hence, a pullback move from around these supports cannot be ruled out. However, it continues to be a ‘Sell on Rise’ market and thus traders should be cautious on pullback moves," Ruchit Jain of 5paisa.com said.

On Nifty Bank index, Rajesh Palviya, VP - Technical and Derivative Research at Axis Securities said, "The index continues to move in a Lower Top and Lower Bottom formation on the daily chart, indicating negative bias. The chart pattern suggests that if Bank Nifty crosses and sustains above the 38600 level, it would witness buying, which would lead the index towards 38900-39200 levels. Important support for the day is around 38200. However, if the index sustains below 38200, it may witness profit booking, which would take the index towards 38000-37800 levels."

Nifty call put option data

Speaking on Nifty call put option ratio, Shilpa Rout, Derivatives Lead Analyst at Prabhudas Lilladher said, "Nifty Option chain for the monthly expiry reflects on PE writers active at 16000PE/16500PE/17000PE - more than a lakh contracts each, with aggressive PE OI unwinding seen across immediate ITM strikes. CE writers active at 17100 strike, with highest fresh additions of over 60 thousand contracts. Thus the data hints on the immediate strong resistance built up."

Bank Nifty call put option data

"Option chain reflects on PE writers being active at 38000/37500 strikes - overall above 70 thousand contracts each and over 25 thousand fresh contracts each as well. CE writers continue to be active aggressively at 39000 strike - more than a lakh contracts, with highest fresh contracts seen at 38500CE," Shilpa Rout said.

Day trading stocks

While talking on day after strategies, stock market experts — Ravi Singh, Vice President & Head of Research at Share India and Manoj Dalmia, Founder & Director, Proficient Equities — recommended 4 stocks to buy or sell today.

Ravi Singh's stocks to buy today

1] Dr. Lal PathLabs: Buy at 2650, target 2800, stop loss 2600

2] Cipla: Buy at 1090, target 1180, stop loss 1050

Manoj Dalmia's shares to buy today

3] IndusInd Bank: Buy at 1185, target 1194, stop loss 1176

4] Mahindra & Mahindra (M&M): Sell at 1219, target 1225, stop loss 1199.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

ABOUT THE AUTHOR

Asit Manohar

Chief Content Producer at Live Mint Digital Team
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