Trade Call: 2 Stock Picks By Sumeet Bagadia On Wednesday, 7th Feb

Ahead of this week's pivotal event-the RBI's monetary policy-benchmark indices closed on Tuesday almost at their day high, despite the fact that most European and Asian markets were trading positively. On February 6, the Nifty surged 157.70 points or 0.72 per cent to close at 21,929.40, while the Sensex gained 454.67 points, or 0.63 per cent to settle at 72,186.09.

Top Nifty gainers were BPCL, HDFC Life, HCL Technologies, TCS, and Maruti Suzuki; losers included Power Grid Corporation, Britannia Industries, IndusInd Bank, ITC, and Grasim Ind. With the exception of banks, private banks, PSU banks, and FMCG, all sectoral indices ended the day in the green. The most significant gainer among the sectors was IT, followed by oil and gas.

Nifty Outlook

Rupak De, Senior Technical Analyst, LKP Securities said, "The Nifty exhibited a predominantly sideways trend throughout the day, with traders expressing uncertainty regarding the market's direction. A range-bound movement is expected to persist until a breakout occurs on either side. A decisive upward move beyond 21950 has the potential to propel the Nifty towards 22200. Conversely, a decline below 21850 could instigate a correction towards the 21700 level."

Bank Nifty Outlook

Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities said, "The Bank Nifty index experienced a subdued trading session one day ahead of the weekly expiry, with an ongoing struggle between bears and bulls. The lack of a clear trend indicates that a breakout is awaited to determine the market direction. The support is positioned at 45500, while the immediate hurdle lies at 46000. A successful break above 46000 is anticipated to propel the index towards 46500 on the upside."

Stocks To Buy

On Wednesday, February 7, Choice Broking's Executive Director Sumeet Bagadia recommended buying shares of HEG and MGL.

Mahanagar Gas

Buy MGL in cash @ Rs 1539, stop-loss: Rs 1509, target: Rs 1592

MGL has recently experienced a significant breakthrough above the crucial resistance zone ranging from 1450 to 1500 on the daily chart. This breakout has been accompanied by a consolidation of the upward movement, characterized by higher highs and higher lows. The strong bullish sentiment is further validated by a noticeable surge in trading volume.

Key technical indicators, particularly the Relative Strength Index (RSI), highlight the positive momentum in the stock. The RSI not only indicates favourable trends but also aligns with the stock trading above important moving averages, including the 20-day, 50-day, and 100-day Exponential Moving Averages (EMA). This convergence underscores the continued strength in MGL price action.

In summary, the decisive breakout, along with encouraging volume and the positive alignment of key technical indicators, suggests a bullish outlook for MGL. Traders and investors may interpret this analysis as indicative of potential sustained upward momentum in the stock.

Considering the above analysis, we recommend MGL in cash at the current market price (CMP) of 1539, setting a target of 1592, and implementing a stop loss at 1509.

HEG

Buy HEG in cash @ Rs 1951, stop-loss: Rs 1870, target: Rs 2090

In the dynamic equity markets, HEG stands out at 1951 with strong technical support. It comfortably maintains positions above key exponential moving averages, with recent price and volume surges hinting at potential upward movement. Notably, a compelling candlestick pattern on daily charts reinforces bullish sentiment.

A crucial factor to monitor is the emergence of a resistance zone at 2000, pivotal for future trajectory. Breaching this resistance could propel HEG towards targets of 2090. Investors are advised to closely track performance around this level to gauge momentum sustainability.

Strategically, purchasing HEG at dips suggested or can buy @ 1951, with a recommended stop-loss at 1870 for risk management. Simultaneously, targeting 2090 aligns with potential upward movement indicated by technical analysis, offering a clear plan for entry, risk mitigation, and target achievement.

In conclusion, navigating equity markets demands attention to technical indicators and strategic planning. This analysis of HEG serves as a guide for investors, enabling informed decisions amidst market complexities.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.