On May 31, bulls made a notable comeback after five consecutive sessions dominated by bears, marking a positive start to the June series. The Nifty 50 closed above 22,500 with moderate gains, although it traded within the previous day's range amid heightened volatility ahead of exit polls. The exit polls, announced on June 1 after the final phase of the Lok Sabha elections, indicating a likely victory for the BJP-led NDA government for third time. Now all eyes are on actual results of Lok Sabha election due on June 4.
The BSE Sensex climbed 76 points to 73,961, while the Nifty 50 settled at 22,531, up 42 points on Friday, forming a small bearish candlestick pattern with upper and lower shadows on the daily charts, indicating volatility. For the week, the index was down 1.86 percent, showing a Dark Cloud Cover pattern on the weekly charts. Interestingly, the index defended the 20-day SMA (22,477) as well as the 50 percent Fibonacci retracement level (22,460) of its recent journey from 21,821 to the record high of 23,111. Holding these levels could propel the index to the 22,800-23,000 zone, while failure could lead it down to the 22,300-22,200 levels. The market breadth remained negative for over a week but improved on Friday, with 1,145 declining shares against 1,113 advancing shares on the NSE.
Here are some trading ideas for the near term:
Jigar S Patel, Senior Manager - Equity Research at Anand Rathi
NHPC | CMP: Rs 107.25
After trading within a consolidation range of approximately Rs 99 to Rs 104 since May 28, 2024, NHPC has broken out, surpassing the upper limit of Rs 104 and maintaining its position above this level. Daily stochastics showed a bullish crossover near the oversold zone, suggesting an increase in buying pressure.
Therefore, it is recommended to buy NHPC in the price range of Rs 105 to Rs 108, with a target at Rs 120, and a stop-loss near Rs 99 based on a daily closing price.
Also read: Raamdeo Agrawal on Exit Poll: India’s market-cap will double to $10 trillion in next 4-5 years
Strategy: Buy
Target: Rs 120
Stop-Loss: Rs 99
SJVN | CMP: Rs 139.70
After peaking near Rs 153 on May 22, 2024, SJVN declined by approximately Rs 22 (14-15 percent). It has shown resilience in the last two sessions by holding the middle Bollinger band. The daily DMI (Directional Movement Index) indicator has given a bullish cross, indicating a potential shift in momentum. Hence, traders are advised buying SJVN in the range of Rs 138-140, with a target at Rs 155, and a stop-loss at Rs 131 based on a daily closing price.
Strategy: Buy
Target: Rs 155
Stop-Loss: Rs 131
Campus Activewear | CMP: Rs 277.35
After consolidating within the range of Rs 242-266, Campus has broken out of an 8-month bearish trendline. The weekly DMI has given a bullish cross. Hence, one can buy Campus in the range of Rs 274-278, with a target at Rs 310 and a stop-loss of Rs 257 based on a daily closing price.
Strategy: Buy
Target: Rs 310
Stop-Loss: Rs 257
Milan Vaishnav, CMT, MSTA, Founder of Gemstone Equity Research & Advisory Services
Reliance Industries | CMP: Rs 2,860.8
Reliance stock has been in a sideways consolidation over the past few weeks. After reaching a high of Rs 3,024.90 in March this year, Reliance has formed a falling channel and remains in sideways consolidation. The OBV (On-Balance Volume) is rising while the stock consolidates, hinting at accumulation in the stock with good participation in volumes. The stock is inside the improving quadrant of the RRG (Relative Rotation Graphs), suggesting potential outperformance against the broader markets. The stock may be bought above Rs 2,865, with a target of Rs 3,000 and a stop-loss of Rs 2,800.
Strategy: Buy
Target: Rs 3,000
Stop-Loss: Rs 2,800
Hindustan Unilever | CMP: Rs 2,329
Hindustan Unilever is striving to establish a base after experiencing a corrective decline from Rs 2,669.40 levels seen in January this year. The most recent phase of the decline has come with a bullish divergence in the RSI; while prices marked lower lows, the RSI did not, indicating potential trend reversal. The stock has confirmed this potential reversal by staging a technical pullback and forming a higher bottom. It can be bought above Rs 2,340 levels, with Rs 2,260 set as a protective stop-loss. The stock is expected to test Rs 2,445 levels over the coming week.
Strategy: Buy
Target: Rs 2,445
Stop-Loss: Rs 2,260
Osho Krishan, Senior Analyst - Technical & Derivative Research at Angel One
EID Parry India | CMP: Rs 668
EID Parry has witnessed a decisive price volume spurt, gaining nearly 7 percent WoW, and has broken out of a multi-week consolidation. It has witnessed a ‘Cup & Handle’ pattern breakout, backed by decent volumes. Oscillators, the 14-period RSI (Relative Strength Index) and MACD (Moving Average Convergence Divergence) suggested a potential upside. Hence, one can buy EID Parry around Rs 650-660, with a target of Rs 740-750, and a stop-loss at Rs 600.
Strategy: Buy
Target: Rs 750
Stop-Loss: Rs 600
Indian Overseas Bank | CMP: Rs 68.9
IOB has been following a cycle of higher highs and higher lows, staying above all significant EMAs on the daily chart. The MACD has seen a positive crossover. Hence, one can buy the stock around Rs 66-68, with a target of Rs 76, and stop-loss at Rs 62.
Strategy: Buy
Target: Rs 76
Stop-Loss: Rs 62
JK Paper | CMP: Rs 385.5
JK Paper has shown a strong resurgence, retracing almost 50 percent from its steep correction from Rs 448 subzones. Additionally, the stock has surpassed all its major EMAs, and the RSI and MACD signal a reversal from the oversold terrain. Hence, traders can buy JK Paper around Rs 380, with a target at Rs 410-420 and a stop-loss of Rs 360.
Strategy: Buy
Target: Rs 420
Stop-Loss: Rs 360
Subash Gangadharan, Senior Technical/Derivative Analyst at HDFC Securities
Ratnamani Metals and Tubes | CMP: Rs 3,404
Ratnamani Metals has rallied higher after finding support at Rs 2,581, reversing its recent downtrend. The 14-day RSI is rising and above its 9-day EMA. Hence, one can buy Ratnamani Metals around current levels.
Strategy: Buy
Target: Rs 3,800
Stop-Loss: Rs 3,200
Adani Total Gas | CMP: Rs 1,039
Adani Total Gas stock has made a Double Bottom pattern around the Rs 846 levels. It has subsequently rallied higher. This week (ending May 31), it has broken out of a trading range on the back of huge volumes. Momentum readings like the 14-week RSI too are in rising mode and not overbought. With intermediate technical set up too looking encouraging, we expect the stock to gradually move higher in the coming sessions.
Adani Total Gas has formed a Double Bottom pattern around Rs 846 and has broken out of a trading range on the back of huge volumes. The 14-week RSI is rising and not overbought. Hence, one can buy Adani Total Gas at current levels for an expected gradual move higher.
Strategy: Buy
Target: Rs 1,225
Stop-Loss: Rs 950
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