Markets
Stocks to buy: Two stock recommendations from MarketSmith India for 10 December
Summary
- Here are two stocks to buy as recommended by MarketSmith India for Tuesday, 10 December.
Nifty 50 on 9 December
The Nifty 50, India’s benchmark stock market index, is consolidating around its 100-day moving average (DMA) and traded within a narrow range for the second consecutive day on Monday. The index closed 0.24% lower in a lacklustre session on Monday, 9 December, forming a “doji" candle with a lower-high and lower-low price structure—indicating indecision between buyers and sellers. It continued to oscillate in the 24,580–24,705 range, ultimately settling 59 points lower at 24,619. The advance-decline ratio remained balanced at 1:1.
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The index has retraced 50% of its recent decline and is now facing resistance near the 100-DMA, which is currently around 24,700. This level could prove pivotal in today’s trading session.
Momentum indicators also provide mixed signals:
RSI (14-period): Trending upward and positioned around 58, suggesting moderate strength.
MACD: A positive crossover above the central line indicates the potential for bullish momentum.
The prevailing trend reflects a bullish sentiment in the market. However, fresh bullish positions should only be considered if the index decisively crosses and sustains above its 100-DMA. A sustained move above 24,700 could pave the way for an upside toward 25,000–25,200. Conversely, failure to breach and hold above this level may result in continued volatility.
As per O'Neil's methodology of market direction, the current market status is categorized as a “Rally Attempt." This phase begins on the third day after the index closes higher off its most recent bottom, following a Correction (or Downtrend).
How Nifty Bank performed
The Nifty Bank index opened on a weak note and remained volatile throughout Monday's trading session. It fluctuated within a range of 53,326.40–53,775.10 before closing at 53,407.75. The index formed a bearish candle with a long upper wick, signalling selling pressure at higher levels. However, it managed to hold above the previous day’s low, maintaining a positive undertone.
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Currently, Nifty Bank is trading comfortably above all its key moving averages, supported by bullish momentum on multi-timeframe charts.
Technical Indicators:
RSI: The momentum indicator has flattened and tilted slightly downward, positioned around 64, reflecting moderate strength.
MACD: A positive crossover indicates continued bullish momentum.
ADX: The trend directional indicator suggests a strong bullish trend, reinforcing the positive outlook for this index.
At this stage, the Nifty Bank index faces strong resistance at 53,900–54,000. A decisive breakout above this level could propel the index toward 54,500 in the near term. Sustained trading above 54,500 may further accelerate momentum, potentially driving the index into uncharted territory with targets around 57,000 in the coming weeks. However, failure to surpass and hold above the resistance zone could lead to choppy and range-bound trading.
As per O'Neil's market direction methodology, the current market status is classified as a “Confirmed Uptrend." This phase begins with a follow-through day or when the index reclaims its previous uptrend high, signalling the start of a sustained rally.
Two stocks to buy, recommended by MarketSmith India:
VRL Logistics Ltd: Current market price ₹ 571.35| Buy at ₹ 562–575| Profit goal ₹ 685| Stop loss ₹ 529| Timeframe 2–3 Months
Metropolis Healthcare Ltd: Current market price ₹ 2,190.45| Buy at ₹2,150–2,200 | Profit goal ₹2,600 | Stop loss ₹ 1,978| Timeframe 3–4 Months
