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Business News/ Markets / Stock Markets/  Stocks to buy this week: HDFC Bank, L&T, Mphasis, Bharat Dynamics among 9 technical picks; do you own any?

Stocks to buy this week: HDFC Bank, L&T, Mphasis, Bharat Dynamics among 9 technical picks; do you own any?

Nifty 50 rises, lacks fresh triggers. Technical analysis suggests possible buying above 22,150 level and selling below 21,800 level. Experts recommend buying sound stocks. Analysts suggest targets for L&T, SJVN, Bharat Dynamics.

For the week, Axis Securities expects Nifty 50 to trade in the range of 22,400-21,500 with mixed bias. (Agencies)Premium
For the week, Axis Securities expects Nifty 50 to trade in the range of 22,400-21,500 with mixed bias. (Agencies)

Nifty 50 has been on an upward march since last Tuesday. However, the rise in the index has been slim as the market lacks fresh positive triggers. The Q3 earnings have concluded on a healthy note and now market focus has shifted to macroeconomic indicators and global news flows.

On the technical front, the Nifty formed a bullish candle with a lower shadow on the weekly chart. According to the brokerage firm Axis Securities, the chart pattern suggests that if Nifty crosses and sustains above the 22,150 level, it would witness buying, leading the index towards 22,300-22,400 levels. However, if the index breaks below the 21,800 level, it would witness selling, taking the index towards 21,600-21,500.

"The weekly strength indicator RSI continues to remain flat, indicating an absence of strength. However, the momentum oscillator

Stochastic has turned positive from the oversold zone, indicating a possible up-move in the near term," said the brokerage firm.

For the week, the brokerage firm expects Nifty 50 to trade in the range of 22,400-21,500 with mixed bias.

Also Read: Why Nifty 50 index may touch record high this week — explained with 5 reasons

Experts recommend buying technically and fundamentally sound stocks at the current juncture. Based on the recommendations of several experts, below are nine stocks that one can consider buying for the next three to four weeks. Take a look:

Shiju Koothupalakkal, Technical Research Analyst, Prabhudas Lilladher

Larsen & Toubro (L&T) | Last traded price (LTP): 3,386.75 | Target price: 3,760 | Stop loss: 3,240 | Upside potential: 11%

The stock has witnessed a decent correction from the peak near 3,740. 

After a short consolidation, taking support near the important 100-period MA (moving average) of 3,250 level, it has seen a decent pullback with a positive candle formation on the daily chart to improve the bias. 

The RSI has also corrected from the overbought zone and is currently well-placed to signal a buy with a trend reversal indicated.

SJVN | LTP: 120.50 | Target price: 146 | Stop loss: 116 | Upside potential: 21%

The stock in the last one month witnessed a strong run-up and after witnessing a decent erosion from the peak level of 170, has bottomed out near the 102-104 zone. 

A positive candle formation moving past the 50EMA level of 109 has further improved the bias to indicate a further rise in the coming sessions.

Bharat Dynamics | LTP: 1,709.90 | Target price: 1,900 | Stop loss: 1,630 | Upside potential: 11%

The stock overall maintained a strong uptrend. After a steep decline, it has taken support near 1,560 and consolidated near the significant 50EMA level of 1,605. 

A series of positive candle formations has improved the bias to indicate a further rise. 

"With the RSI well-placed and indicating a trend reversal to signal a buy, we anticipate further upward with an initial upside target of 1,900, keeping the stop loss of 1,630," said the analyst.

Also Read: Paytm share price surges 5% as it moves nodal account to Axis Bank

Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers

HDFC Bank | LTP: 1,419.90 | Target price: 1,500 | Stop loss: 1,368 | Upside: 6%

HDFC Bank peaked at around 1,721 on December 28, 2023, before declining by approximately 358 points (21 per cent). 

Over the past two weeks, the stock has traded within a tight range of 1,380 to 1,480, indicating market indecision. 

On the indicator front, the daily scale stochastics indicator identified a "regular bull divergence" near a 1.13 harmonic ratio. 

This divergence suggests potential upward momentum despite recent price declines, signalling a possible bullish reversal in the near future. 

"One can add longs in the zone of 1,400-1,425 for an upside target of 1,500 and stop loss would place near 1,368 on a daily close basis," said Patel.

MMTC | LTP: 78.30 | Target price: 110 | Stop loss: 58 | Upside potential: 40%

Recently, MMTC exhibited a significant technical development, notably forming an inverse head and shoulders pattern on the monthly scale, particularly within the price range of 65-75 levels. 

This pattern, characterized by three troughs with the middle one (head) lower than the others (shoulders), often signifies a bullish reversal. 

Adding to the bullish sentiment is the observation on the indicator front, the monthly Stochastic oscillator, a momentum indicator, has reversed direction from the 50 level. 

Such a reversal is typically interpreted as a shift in momentum from bearish to bullish. 

"Combining these technical signals, we have recommended traders to initiate long positions in MMTC within the range of 70-80, with a bullish target set at 110. To manage risk, we have suggested implementing a stop-loss strategy, with the stop loss set at 58 on a daily closing basis," said Patel.

Rain Industries | LTP: 201.10 | Target price: 240 | Stop loss: 175 | Upside potential: 19%

From March 2023 till December 2023, this counter has been consolidating between 145 and 155. 

For the last two months, it has given a breakout from this range on a weekly closing basis, which is looking lucrative. 

It has also formed a bullish Gartley pattern, which is 1.38 years old, making it more reliable. 

Also, it has violated a couple of trendlines. The best part about this bullish reversal is that every bottom has bought with huge volume bars which indicates bullish bias in the counter. 

On the indicator front, the monthly stochastic shying away from being oversold, further affirms our bullish stance on the counter. 

"We advise traders and investors to go long in the range of 190-205 with an upside target of 240, and the stop loss would be placed at 175 on a daily close basis," Patel said.

Also Read: Quess Corp share price jumps over 15% to touch 52-week high as board approves demerger plan

Axis Securities

Mphasis | LTP: 2,801.95 | Buying range: 2,800-2,744 | Target price: 3,080-3,210 | Stop loss: 2,620 | Upside potential: 15%

On the weekly chart, Mphasis has broken out above the downward sloping trendline at 2,775 with a bullish candle, signalling the continuation of a medium-term uptrend.

The stock is trending within an upward-sloping channel, recently finding support at the lower band and now heading towards the upper band.

The closing above the upper Bollinger band on the daily chart has generated a buy signal in the short term also.

The weekly strength indicator RSI, given a crossover above its reference line, generated a buy signal.

Castrol India | LTP: 207.70 | Buying range: 205-200 | Target price: 238-245 | Stop loss: 185 | Upside potential: 18%

On the weekly chart, Castrol India broke above the bullish flag pattern above 180, indicating a continuation of the uptrend.

The stock witnessed consolidation following a breakout and has since resumed picking up momentum.

It is exhibiting a pattern of higher high-low formations on the daily chart and holding above the medium-term upward-sloping trendline, signalling a medium-term uptrend.

The weekly strength indicator RSI is in a bullish mode and is holding above its reference line, indicating a positive bias.

Syngene International | LTP: 764.70 | Buying range: 762-748 | Target price: 825-845 | Stop loss: 720 | Upside potential: 11%

On the weekly chart, Syngene International has broken out above the downward-sloping trendline at 734 with a bullish candle.

The previous resistance level of 678 is expected to now act as support due to the principle of polarity, providing a support zone for the stock's price movement.

The stock is holding above key averages of 20, 50, 100, and 200 days simple moving average (SMA), signalling a strong uptrend in the stock.

The weekly strength indicator RSI, given a crossover above its reference line, generated a buy signal.

Read all market-related news here

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.

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Published: 19 Feb 2024, 11:21 AM IST
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