Stock recommendations for 25 September from MarketSmith India

The downturn was broad-based, with the advance-decline ratio reflecting a bearish market breadth as declines significantly outnumbered advances across the board. The IT and auto sectors were the hardest hit, as concerns over a steep US H-1B visa fee hike and profit booking in auto stocks pressured key heavyweights.

Two stock recommendations for today by MarketSmith India

Buy: Edelweiss Financial Services (current price: ₹120)

• Why it’s recommended: Diversified businesses, Strong asset reconstruction arm, Growing retail lending, Improved asset quality
• Key metrics: P/E: 19.98, 52-week high: ₹145.53, volume: ₹187.14 crore
• Technical analysis: Cup-with-handle breakout
• Risk factors: Stressed asset exposure, Intense competition, High funding dependence, Regulatory & governance risks
• Buy: ₹119-121
• Target price: ₹140 in two to three months
• Stop loss: ₹110

Buy: TD Power Systems Limited (current price: ₹574)

• Why it’s recommended: Strong order execution and demand recovery, export and project diversification
• Key metrics: P/E: 45.64; 52-week high: ₹578; volume: ₹ 65.56 crore
• Technical analysis: Reclaimed 50-DMA with above average volume
• Risk factors: Revenue concentration & client dependency, project execution & capital intensity
• Buy at: ₹565-577
• Target price: ₹660 in two to three months
• Stop loss: ₹ 533

How the market performed on 24 September

Indian equities ended lower on 24 September, with the Nifty 50 falling 112.6 points (0.45%) to close at 25,056.9, and the Sensex slipping 386 points (0.47%) to settle near 81,716.

The selling pressure was broad-based, led by IT stocks, which declined on concerns around a proposed H-1B visa fee hike, while financials and autos also weighed on sentiment.

The mid cap and small cap indices underperformed, losing 0.7-1% and reflecting risk-aversion across the market. The advance–decline ratio remained negative, underscoring weak market breadth as declines outnumbered gainers.

The Nifty 50 encountered resistance around 25,450 and subsequently saw profit booking, indicating some consolidation after the recent uptrend.

Momentum signals suggest a healthy, though moderating, setup. The RSI has cooled off from overbought territory and is now placed at 52, yet continues to hold above the downward-sloping trendline breakout, reinforcing underlying strength.

Meanwhile, the MACD remains in positive territory, reflecting that the broader trend bias is still constructive despite near-term volatility. Overall, the technical structure suggests that while some pause or pullback cannot be ruled out, the index retains a favorable outlook as long as it sustains above immediate support levels.

According to O'Neil’s methodology of market direction, the market status has been downgraded to an "Uptrend Under Pressure" as Nifty breached its "50-DMA" and the "distribution day count" is at one.

The Nifty 50 extended its losing streak but managed to hold above the 25,000 psychological mark, offering some near-term relief. Key support is now placed in the 25,000–24,950 zone, which also aligns with the 100-DMA, making this band critical to watch. As long as the index trades above these levels, it is likely to consolidate within the 24,950–25,250 range in the coming sessions. However, a decisive breach below 24,950 could invite additional selling pressure, dragging the index lower toward the 24,800 level.

How did Nifty Bank perform?

Nifty Bank opened weak and remained in negative territory for most of the session, forming a bearish candle with a lower high and lower low on the daily chart. The index opened at 55,387.10, hit an intraday high of 55,511.10, slipped to 55,040.45, and finally settled at 55,121.50. The close confirms persistent selling pressure and a defensive tone among participants. Repeated intraday rebounds were sold into, reflecting limited risk appetite from longs. The overall structure suggests bears retained control despite brief attempts to stabilise.

Momentum signals were soft: RSI has edged down to 37, indicating fading strength, while the MACD still maintains a positive crossover, limiting immediate downside conviction. By O’Neil’s methodology, Bank Nifty is classified as Uptrend Under Pressure, implying the trend is intact but fragile. This setup typically warrants selective exposure and tighter stop losses around key pivots. A further dip in RSI toward the 30–35 band could invite oversold bounces but with weak follow-through. Until momentum improves, sentiment is likely to stay cautious and reactive to data-driven cues.

The index is approaching a critical technical zone with immediate resistance at 55,700–55,500. A sustained breakout above this band would strengthen the medium-term structure and could unlock moves toward 56,600 and 57,200. On the downside, robust support sits at 54,900–54,800, with a decisive breach risking an accelerated decline. A range-bound phase between these markers cannot be ruled out while the market digests recent weakness. For traders, fading extremes within the band and respecting stops remains prudent until a directional break emerges.

MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O'Neil. You can access a 10-day free trial by registering on its website.

Trade name: William O’Neil India Pvt. Ltd.

Sebi Registration No.: INH000015543

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.