Day Trading Guide: stock recommendations for Monday

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Indian markets ended another trading session deep in the red on Thursday as bears regained complete control of the proceedings on the D-street making it three days of intense profit booking in a row. Further, Nifty-50 Index ended below the key support line of 50-DMA placed at 17,850, confirming intermediate weakness. However, following the relentless selling pressure in the past three trading sessions, the index has now reached oversold territory on shorter time frame charts, suggesting a possible pullback short covering rally to 17,900-17,980 levels.

However, this pullback may be short lived as the index continues to make lower high and a breakdown from the key support level of 17,600 being the previous trough will trigger lower lows as well. Breakdown from this key support of 17,600 will intensify the selling pressure dragging the Index lower to levels of 17,450.

Equity recommendations
SBI | BUY @ CMP of Rs 504
Rs 540
Stop Loss: Rs 485
The stock has broken out of a narrow consolidation upper end, after taking support at the Fibonacci retracement level suggesting resumption of uptrend. Further, RSI indicator is also confirming the bullishness building up in recent times.

Mindtree | Sell @CMP of Rs 4,840
Rs 4,450
Stop Loss: Rs 5,035

The stock has turned south and is on the verge of a breakdown from a trendline support, suggesting weakness building up. Further, RSI has turned down from below the 70 level after making a negative divergence conforming weakness.

(The author, Aditya Agarwala, is Senior Technical Analyst, Yes Securities. The views are his own).