Day trading guide for Monday: 4 stocks to buy or sell today — 19th September

Market


Day trading guide for Monday: Following weak global cues after a disappointing US CPI data for August 2022, global markets including Dalal Street witnessed heavy sell-off in the last two sessions last week. Nifty witnessed sharp weakness on Friday and closed the day lower by 346 points at 17,530 levels. BSE Sensex crashed 1093 points and closed at 58,840 levels whereas Nifty Bank went off 432 points and closed at 40,776 levels.

According to stock market experts, Nifty on the weekly chart formed a long range bear candle with the bearish candle formation like dark cloud cover. This weeks chart pattern confirms a false upside breakout of the significant resistance of down trend line at 17,900 levels.

Trade setup for stock market today

Speaking on technical outlook for Nifty today, Nagaraj Shetti, Technical Research Analyst at HDFC Securities said, “The short term trend of Nifty seems to have reversed down. The formation of bearish candlestick pattern on the daily and weekly chart indicates more weakness ahead for the market. The next lower levels to be watched around 17,200 to 17,150 in the next couple of weeks. Any upside from current levels could find resistance around 17,700 levels.”

Expecting weak sentiments to continue further on Dalal Street, Ruchit Jain, Lead Research at 5paisa.com said, “Nifty 50 index broke the support end of the pattern with a gap down opening on Friday and then it even broke its important 20 DEMA support of 17,700. Once that was broken, the trend changed and the index entered a corrective phase again, which resulted into a selling pressure throughout the day to test the 17,500 mark on Nifty. The momentum readings on the hourly charts were already in a sell mode and the the negative crossover from the overbought zone on the daily chart too indicates that the short term trend for the index has turned negative. In the coming few sessions, we could see some further sell-off but in between recovery cannot be ruled out as the hourly readings are approaching oversold territory.”

“Amongst sectoral indices, the Bank Nifty too corrected by a percent on Friday but the broader trend has still not turned negative for the banking index. Hence, a relative outperformance could continue in this sector. But for this index, 40300 would be seen as crucial short term support,” Ruchit Jain of 5paisa.com said.

Nifty Call Put Option data

“Nifty Option chain for the weekly expiry reflects on CE writers adding highest exposure at 17800CE – overall more than a lakh contracts, with highest fresh additions of 80 thousand contracts as well. PE writers standing tall at 17000 PE – over 90 thousand contracts, followed by 16500/17500 strikes- max exposure of more than 80 thousand contracts each. PCR OI at 17500 is over 2 and 17600 being nearly 0.5, would be crucial to keep on radar to watch for the direction ahead,” said Shilpa Rout, Derivatives Lead Analyst at Prabhudas Lilladher.

Nifty Bank Call Put Option data

Shilpa Rout of Prabhudas Lilladher went on to add, “Bank Nifty Option chain looks scattered and all over. PE writers being active at 40000 strike – overall 50 thousand contracts, followed by additions of over 40 thousand contracts at various other strikes. CE writers adding exposure of over more than 70 thousand contracts at many strikes as well- all the way up till 43000CE, which hints on better structure for the index.”

Day trading stocks

Speaking on stocks to buy today, stock market experts — Mehul Kothari, AVP — Technical Research at Anand Rathi and Anuj Gupta, Vice President — Research at IIFL Securities — recommended 4 shares to buy today.

Mehul Kothari’s shares to buy today

1] Gujarat Gas: Buy at 505, target 540, stop loss 480

2] Max Financial Services: Buy at 825, target RS 865, stop loss 800

Anuj Gupta’s stocks to buy today

3] State Bank of India or SBI: Buy at CMP, target 590, stop loss 530

4] Tata Motors: Buy at CMP, target 460, stop loss 405.

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

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