Day Trading Guide: 2 stock recommendations for Tuesday

Losing ~7% from the record peak, Nifty fell for the fourth straight session on Monday. The selling pressure intensified as it broke below its prior session’s low. Forming a sizable bearish candle with a low at 17,280, Nifty eventually ended at 17,441 – down 324 points or 1.8%. Nifty breadth remained negative with 82% of its components settling in red. Breach of various support zone ensured shift of range on the downside for Nifty. Minor recovery might be there, however today’s high (i.e. 17,805) is likely to act as a hurdle zone.

Meanwhile, Bank Nifty lost 12% from the all-time high as it fell till 36,655. Bank Nifty revisited its 26-week average levels. Sustenance at current levels could attract mild recovery till 37,400-37,800 level.

All the sectoral indices ended in red, stability is essential for any short term bounce.

Recommendations

Cipla | Buy near Rs 890-894

Stop loss: Rs 870

Target Price: Rs 935

Since August 2021, the stock has been defending levels of 885 on a closing basis. Today it snapped its three sessions' losing streak and hence positive follow-up action could attract some recovery till 935.

PVR | Sell November future near Rs 1,610

Stop loss: Rs 1,650

Target Price: Rs 1,530

Swift decline with multiple bearish candles ensures influence of resistance at play. Negative follow-up through is likely to drag the stock till the Rs 1,530 zone.

(The author Aditya Agarwala, is Senior Technical Analyst, Yes Securities. The views are his own.)