Stocks to buy: Raja Venkatraman recommends three stocks for today—19 December | Stock Market News

Nifty 50 on 18 December: Recap

The lack of clarity in the Nifty 50 has instilled a bearish bias, setting a negative tone for the start of the curtailed trading week. While a few stocks exhibit bullish tendencies, the overall market sentiment remains weak. Profit booking in large-cap stocks has contributed to a gradual decline, with the slow and steady pace of the downturn adding to the market’s complexity.

Read this | Sensex, Nifty down 1.3% as weak rupee spark FPI selling

As trends become increasingly harder to decipher, traders need to adopt strategies that allow flexibility for positions on both sides of the market. Although mid- and small-cap stocks have shown some signs of bullishness, large-cap stocks continue to face a steady decline, fuelling downward momentum across the broader market.

Indian stock markets: Way forward

Currently, leveraged long positions are being unwound, and some short positions have been established. This sets the stage for further declines, especially if the market breaks below the critical 24,100 level. Conversely, a bullish scenario could emerge if key support levels hold firm. Historically, traders are quicker to initiate fresh long positions than shorts. That said, the market appears more prepared for a decline.

The RSI reflects a bearish bias, suggesting the need for strong triggers to reverse the current momentum from lower levels. Options data remains cautious ahead of the US Federal Reserve’s decision, with open interest trends pointing to a deeper oversold status. Given these signals, it would be prudent to hold off on adopting a bullish stance until clearer market cues emerge.

Three stocks to buy, recommended by NeoTrader’s Raja Venkatraman:

• HDFC Asset Management Co. Ltd: Sell at ₹4370, stop ₹4400, target ₹4325

The banking and related sectors have struggled to sustain their gains, with recent trends indicating a downward trajectory. The ongoing pressure in these sectors signals the potential for further declines, presenting opportunities to consider short positions.

• Cipla Ltd: Buy at ₹1480, stop ₹1460, target ₹1510

After sharp decline the pharma counters are seen reviving. With demand continuing to build for the counter, Cipla shares have been generating a steady buying interest. A sharp reversal from oversold levels highlights potential to rise further.

• BF Utilities Ltd: Buy at ₹1040, stop ₹1020, target ₹1070

BF Utilities has been witnessing renewed demand at lower levels, driven by its electricity generation through windmills and infrastructure activities. The sharp rise on the daily charts signals that bullish momentum could continue. With the key resistance level around ₹1,000 now breached, further upside potential can be expected in the days ahead.

Raja Venkatraman is co-founder, NeoTrader.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.