Stocks to buy: Two stock recommendations from MarketSmith India for 13 December
Nifty 50 on 12 December
The Nifty 50, India’s benchmark stock index, remained in consolidation mode around its 50- and 100-day moving averages (DMA). On Thursday, the index closed 0.38% lower, weighed down by weakness in FMCG, auto, and energy stocks. This decline resulted in the formation of a bearish candle with a lower-high and lower-low price structure on the daily chart.
Throughout the day, the index traded on a negative note, reflecting caution ahead of crucial inflation data. The Nifty 50 oscillated within a narrow range of 24,527–24,675 before closing 93 points down at 24,548.70. The advance-decline ratio tilted heavily in favour of the bears, standing at 1:2.
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The Nifty 50 has retraced 50% of its recent decline and is now encountering resistance near its 100-day moving average (DMA). The index is currently positioned around 24,700, a critical level that could influence today’s trading session.
The 14-period Relative Strength Index (RSI) shows a slight downward tilt, currently hovering near 55, indicating moderate momentum. Meanwhile, the Moving Average Convergence Divergence (MACD) is trending with a positive crossover and remains close to its central line, signalling a potential continuation of bullish momentum if resistance levels are breached.
The current trend reflects a sideways sentiment in the market, with the Nifty 50 facing strong resistance around its 100-day moving average (DMA) at approximately 24,700. Fresh bullish positions should only be considered if the index decisively crosses and sustains above this level. A sustained breakout above 24,700 could pave the way for an upside toward 25,000–25,200. However, failure to breach this resistance may lead to increased volatility in the near term.
As per O’Neil’s methodology for market direction, the current market status is classified as a “Rally Attempt.” This phase begins on the third day after the index has closed higher from its most recent bottom, following a Correction (or Downtrend).
How Nifty Bank performed
This major sectoral index opened on a muted note and traded with a negative bias for most of yesterday’s session. It formed a doji candle with a lower-high and lower-low price structure, reflecting indecision in the market. This marks the fifth consecutive day of sideways trading for the index.
Nifty Bank opened at 53,201 and moved within a narrow range of 53,174.40–53,537.45 before closing marginally higher at 53,216.45.
On the technical front, the momentum indicator RSI has flattened with a slight downward tilt and is currently positioned around 60. Additionally, the MACD shows a positive crossover.
The index is currently trading sideways with notable volatility, encountering strong resistance near the 53,900 level. A decisive breakout above this hurdle could pave the way for a move toward 54,500 in the near term. Sustained trading above 54,500 may drive the index into uncharted territory, with strong momentum potentially pushing it toward 57,000 in the coming weeks.
However, failure to break and hold above the resistance at 53,900 could lead to increased volatility and a potential retest of its 21-day moving average (DMA), which is currently positioned near 52,065.
According to O’Neil’s methodology of market direction, the current market status is in a “Confirmed Uptrend.” The uptrend begins with a follow-through day or when the index reclaims its previous uptrend high.
Two stocks to buy, recommended by MarketSmith India:
Bharti Airtel Ltd: Current market price ₹ 1,587.86 | Buy at ₹ 1,570–1,600 | Profit goal ₹ 1,850 | Stop loss ₹ 1,490 | Timeframe 2–3 Months
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Pyramid Technoplast Ltd: Current market price ₹225.35 | Buy at ₹ 219–226 | Profit goal ₹304 | Stop loss ₹ 199 | Timeframe 3–4 Months
