Day Trading Guide: 2 Stock Recommendations for Monday

The last few days have been noticeably different. On Thursday, the Nifty broke the 16,800 support and corrected to 16,203. While on Friday, it recovered to 16,700 levels but failed to close above the previous session’s high.

Nifty slipped below its December 2021 low, however, it managed to defend its yearly average on a closing basis. Looking back, the 52-week SMA levels (i.e. the yearly average) have been intact at the close since August 2020. Sustenance above 16,450 (i.e. the point median of Thursday’s bearish candle) is essential for any stability to emerge.

However, an immediate hurdle is seen near the 16,800-16,850 area and a breakthrough above it is important to gain positive traction.

All sector indices ended in the green, the India Vix also fell by 17%. Going forward, a mixed trend is possible among the sector indices.

The series of ascending lows are still intact on the average charts of the automatic index. Therefore, stability at current levels could prompt buying interest in certain stocks.

Recommendations

ALEMBIC LTD

Buy close to Rs 82.5

Stop-loss: Rs 76.5

Objective: Rs 93

After losing 34% from the previous month’s high, the stock has recovered to 80 levels. Sustainment is likely to attract a near-term reversal down to the 93 area.

ICC

Buy a March call option near Rs 5.5

Stop-loss: Rs 1.5

Objective: Rs 14

The stock bounced off its multi-month support. A positive follow-up action from the bullish candle could mean that the action is due to mean reversion.

(The author, Amit Trivedi, CMT is an institutional equity technical analyst at YES Securities. Opinions are his own.)

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