Trade Spotlight: How should you trade Coal India, Kotak Mahindra Bank, Varun Beverages, Shriram Finance, JSW Steel, and others on March 18?

In the latest session, Coal India broke above the R3 Camarilla daily resistance of Rs 383 and closed above Rs 385, signaling bullish momentum after consolidating between Rs 370-380. The RSI (Relative Strength Index) forming a double bottom near the 50 mark further strengthens the bullish outlook. This breakout indicates potential upside in the coming sessions. Traders may consider entering long positions in the Rs 385-386 zone, with an upside target of Rs 415.

Strategy: Buy

Target: Rs 415

Stop-Loss: Rs 370

Varun Beverages | CMP: Rs 507.25

In the latest session, Varun Beverages broke out of its six-day consolidation and closed above it, signaling bullish momentum. This consolidation occurred above the R3 Camarilla daily pivot, strengthening the breakout's significance. Additionally, a trendline violation in both price action and RSI further confirms the bullish outlook. Traders may consider entering long positions in the Rs 500-510 zone, with an upside target of Rs 555.

Strategy: Buy

Target: Rs 555

Stop-Loss: Rs 480

Tata Motors | CMP: Rs 661

Tata Motors has found support at the 50% retracement level of its rally from March 2020 to July 2024, aligning with key quarterly S1 support levels. Additionally, the weekly RSI has formed an impulsive V-shaped structure below the oversold zone of 30, indicating a potential rebound in the coming sessions. Traders may consider entering long positions above Rs 670, with a target of Rs 740.

Strategy: Buy

Target: Rs 740

Stop-Loss: Rs 635

Jay Thakkar, Vice President & Head of Derivatives and Quant Research at ICICI Securities

Kotak Mahindra Bank Futures | CMP: Rs 1,994.75

Kotak Mahindra Bank has seen significant additions in the Puts, right from the Rs 1,900 strike until Rs 1,980, thus forming a good Put base. However, there is only one strike—Rs 2,000—that has the highest Call open interest, which, when taken off, could lead to sharp short covering. The stock has been facing a hurdle at the Rs 2,000 level on a closing basis for the past 7-8 occasions. Hence, once this range is taken off, a swift upward move can’t be ruled out, mainly due to Call unwinding initially. On the futures front, the stock continues to witness short covering, and above Rs 2,000 levels, it will fuel the upside rally with further short covering.

Strategy: Buy

Target: Rs 2,060, Rs 2,100

Stop-Loss: Rs 1,945

REC Futures | CMP: Rs 411.25

REC Futures have witnessed significant short additions, and the open interest is at its lifetime peak. There has been a positive divergence in the prices, as open interest has made a new high, whereas the prices haven’t, indicating a higher probability of a bounce back on account of short covering. The sector overall has witnessed short covering, and with the market expected to bounce back, the risk:reward is favourable on the long side. The options activity suggests that once the shorts are getting covered slowly, there has been an increase in the Puts until the Rs 410 strike, along with Call unwinding from Rs 380 to Rs 400 strikes. This has improved the PCR (Put-Call Ratio), jumping to 1.01 levels.

Strategy: Buy

Target: Rs 424, Rs 435

Stop-Loss: Rs 399

Asian Paints Futures | CMP: Rs 2,227.9

Asian Paints has managed to bounce back from its recent lows and has managed to hold on to these levels, showing a pause in the downward momentum. The futures open interest has been slowly reducing with the prices bouncing back, indicating some short covering that may continue from hereon. This is supported by the correction in crude oil prices and the weakening of the dollar. There have been significant additions in the Rs 2,200 Put, indicating it to be a strong near-term support, whereas Rs 2,300 has the highest Call open interest, making it the immediate target.

Strategy: Buy

Target: Rs 2,300, Rs 2,360

Stop-Loss: Rs 2,180

Anshul Jain, Head Of Research at Lakshmishree Investments

Som Distilleries & Breweries | CMP: Rs 129

Som Distilleries & Breweries has been forming a 193-day-long rounding bottom/VCP pattern on the daily chart, with a noticeable volume surge on the right side as it approaches the neckline. The March 7's candle saw over 2x the 50-day average volume, while Thursday’s session recorded a 2.25x surge, signaling strong institutional accumulation near the pivot. A decisive breakout above Rs 130 could trigger a sharp rally, with an initial target of Rs 150. Traders should watch for confirmation above this key level.

Strategy: Buy

Target: Rs 150

Stop-Loss: Rs 120

Shriram Finance | CMP: Rs 623.25

Shriram Finance has been shaping a 98-day-long rounding bottom pattern, with a crucial neckline at Rs 645. Last week’s correction occurred on low volumes, staying below the 50-day average, indicating a lack of strong selling pressure. Monday’s open = low candle signals the start of a fresh upmove from the 10-20 EMA spread. The stock is now approaching the Rs 645 neckline, and a breakout above this level could propel it toward the Rs 700 mark in the near term.

Strategy: Buy

Target: Rs 700

Stop-Loss: Rs 600

JSW Steel | CMP: Rs 1,005.7

JSW Steel has been forming a 91-day-long cup and handle pattern, with volumes on the right side going silent—often a precursor to a breakout. A strong volume move above Rs 1,020 could trigger an initial rally toward Rs 1,100. The metal sector is showing notable relative strength, with JSW Steel leading the pack. With metals set to outperform in the next rally, a confirmed breakout could offer a strong trading opportunity in the coming sessions.

Strategy: Buy

Target: Rs 1,100

Stop-Loss : Rs 980

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