Stock market today: Trade setup for Nifty 50 to US Fed policy; 5 stocks to buy or sell on Wednesday — December 18

Stock Market Today: Domestic equity benchmarks Nifty 50 and Sensex reported intense selling pressure in the previous session, dragged by a continued flight of foreign capital amid a negative global market trend. Investors maintained a cautious approach ahead of global central bank interest rate decisions.

For the second day in a row, the 30-share BSE benchmark Sensex tanked 1,064.12 points, or 1.30 per cent, to 80,684.45, below the psychological 81,000 level. The Nifty tumbled 332.25 points or 1.35 per cent to 24,336.

IT firms, which get a bulk of their revenue from the US, dropped 0.5 per cent. All sectoral indexes except media fell. The more domestically focused small-caps and mid-caps declined 0.7 per cent and 0.8 per cent, respectively. The Indian rupee weakened to its lifetime low against the greenback unit.

Trade Setup for Wednesday

Nifty slipped sharply following the formation of a Harami pattern on the daily time frame. “The index has fallen below the 21-EMA, indicating a rise in bearish bets in the market. The indicator is in a bearish crossover, further supporting the negative sentiment,” said Rupak De, Senior Technical Analyst at LKP Securities.

“The short-term outlook remains weak, with the potential for a decline towards 24,200, where an initial round of support is expected. A meaningful recovery might be seen if Nifty does not break decisively below 24,200,” added De.

Bank Nifty Index has formed a big red candle on the daily chart, indicating weakness. “However, the index has been consolidating within a narrow range of 52,500–54,000. Either side’s breakout will decide the index’s future move. Until then, rangebound consolidation will persist,” said Hrishikesh Yedve, AVP of Technical and Derivatives Research at Asit C. Mehta Investment Intermediates Ltd.

Global Markets

The much-awaited US Federal Reserve’s interest rate decision is due later today, for which Wall Street traders have priced in a quarter-point policy reduction. While a 25 basis point (bps) interest rate cut is widely expected, markets are bracing for US Fed policymakers to scale back easing next year, in anticipation of higher inflation under Donald Trump.

US stocks slipped on Tuesday as investors became cautious ahead of the Federal Reserve’s interest rate decision following strong retail sales data. At the open, the Dow Jones Industrial Average fell 61.0 points, or 0.14 per cent, to 43,656.47. The S&P 500 fell 21.5 points, or 0.35 per cent, to 6,052.55, while the Nasdaq Composite dropped 78.3 points, or 0.39 per cent, to 20,095.618.

Stocks to buy today

Sumeet Bagadia, Executive Director at Choice Broking, has recommended two stock picks for today. Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, has suggested three stock ideas. These include Axis Bank, Oberoi Realty, United Spirits, National Aluminium Co. Ltd, and Varun Beverages.

Ganesh Dongre’s day trading stocks

1. National Aluminium Co. Ltd: Buy at ₹226, Target Price ₹235, Stop loss ₹220

A notable bullish reversal pattern has emerged in the stock’s recent short-term trend analysis. This technical pattern suggests the possibility of a temporary retracement in the stock’s price, potentially reaching around Rs.235. The stock is currently maintaining a crucial support level at Rs.220. Given the current market price of Rs.226, a buying opportunity is emerging. This suggests that investors might consider purchasing the stock at its current price, anticipating a rise towards the identified target of Rs. 235.

2. Axis Bank: Buy at ₹1,136, Target Price ₹1,180, Stoploss ₹1,115

We have seen major support around Rs. 1,115. So, at the current juncture, the stock has again seen a reversal price action formation at the Rs.1,136 level. It may continue its rally until its next resistance level of Rs. 1,180. Therefore, traders can buy and hold this stock with a stop loss of Rs.1,115 for the target price of Rs.1,180 in the upcoming weeks.

3. Varun Beverages: Buy at ₹648. Target Price ₹680, Stoploss ₹625

A notable bullish reversal pattern has emerged in the stock’s recent short-term trend analysis. This technical pattern suggests that there could be a temporary retracement in the stock’s price, possibly to around Rs. 680. Currently, the stock is holding a crucial support level at Rs.625.

Given this scenario, the stock could rebound towards the Rs.680 level in the near future. To manage risk effectively, traders should consider taking a long position, with a strategic stop loss set at Rs.625. The target price for this trade is Rs.680, reflecting the anticipated upward movement based on the identified technical.

Sumeet Bagadia’s stocks to buy today

4. United Spirits: Buy at ₹1,563.30, Target Price ₹1,673, Stop loss ₹1,508

United Spirits is trading at ₹1,563.30, exhibiting a strong uptrend as it continues its upward reversal from lower levels, signalling sustained bullish momentum. The stock has given a cup and handle pattern breakout on the daily timeframe, with the key resistance level at ₹1,600.

A breakout above this level is expected to enhance market sentiment and favour buyers, driving the stock toward its short-term target of ₹1,673 and continuing its upward trajectory. United Spirits is trading comfortably above its 20-day, 50-day, 100-day, and 200-day Exponential Moving Averages (EMAs), further reinforcing the ongoing bullish trend.

Additionally, the Relative Strength Index (RSI) stands at 64.39 and is trending upward, reflecting growing buying momentum. On the downside, immediate support is identified at ₹1,550. To manage risk effectively, a stop-loss at ₹1,508 is recommended to safeguard against unexpected market reversals.

Based on the favourable technical setup and prevailing market conditions, United Spirits presents a promising buying opportunity with a target of ₹1,673, provided appropriate risk management measures are implemented.

5. Oberoi Realty: Buy at ₹2,315.55, Target Price ₹2,478, Stoploss ₹2,234

Oberoi Realty is currently trading at ₹2,315.55, exhibiting a strong bullish trend characterized by the formation of higher highs and higher lows. The stock has marked new all-time highs for two days, confirming sustained upward momentum. This positive movement is supported by a significant increase in trading volumes, indicating strong buying interest from investors.

If Oberoi Realty manages to sustain above the critical resistance level of ₹2,400, it could present an ideal entry point for long positions, with a potential short-term target of ₹2,478. The Relative Strength Index (RSI) stands at 75.85 and continues to trend upward, reflecting robust bullish strength. Furthermore, the stock is trading comfortably above its key moving averages, including the short-term 20-day EMA, medium-term 50-day EMA, and long-term 200-day EMA, further reinforcing the ongoing bullish trend.

Given the favourable technical setup and the strength of key indicators such as RSI and moving averages, Oberoi Realty presents a strong buying opportunity. Entering at the current market price of ₹2,315.55, with a stop-loss at ₹2,234 and a target of ₹2,478, offers a compelling strategy to capitalize on the stock’s bullish momentum.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts, consider individual risk tolerance, and conduct thorough research before making investment decisions, as market conditions can change rapidly, and individual circumstances may vary.