Stock calls by Tradebulls Securities: Buy Motherson Sumi, sell Tata Chem

Nifty outlook and top trading ideas from Sacchitanand Uttekar, DVP - Technical (Equity), Tradebulls Securities

50- Double Exponential Moving Average (DEMA; 11,658) acted as support for the third consecutive session on the downside with occurrence of another “Doji” at lower end of consolidation support. Occurrence of “Bearish Belt Hold” candle along with a negative crossover in the previous trading session warrants a cautious approach in the forthcoming sessions.

Put writing at 11,600 levels for weekly expiry continues with highest put bearing at the same while call writing at 11,900 strike suggests further choppy action on immediate basis. Daily RSI slipped below 50 levels and unable to surpass its signal line and an upside momentum is only expected once the same is surpassed and sustained. Traders are advised to continue maintaining long short strategy until meaningful exhaustion in downside momentum is visible or emergence of bullish reversal patterns in coming sessions

STOCK RECOMMENDATION

TATACHEM

Reco:  SELL

CMP:  Rs 611

Post consolidation in last few trading sessions, the stock breached and closed below 20 & 50 DEMA along with spike in volumes. Hourly RSI attained fresh new lows while in oversold zone for the oscillators indicates commencement of fresh downside. On the weekly scale, it is unable to surpass its 50 WEMA and supports the negative bias prevalent in lower horizon scale. The stock can be sold with stop placed above 625 levels for 590 to be obtained in coming sessions

MOTHERSUMI

Reco:   BUY  

CMP :  Rs 125.30

The stock is bouncing post registering fresh 52 week low around 111 levels. Prevalent “Bullish Divergence” & “Bullish Belt Hold” candle on the weekly scale along with Daily RSI surpassing 50 levels suggests the stock might be in process of confirming medium term bullish reversal. Traders can long the stock with stop placed below 121 levels for 132 levels to be obtained in coming sessions.  

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Disclaimer: The analyst may have positions in any or all the stocks mentioned above.