Day Trading Guide: 2 stock recommendations for Thursday

After Tuesday’s swift downtick, Nifty today swung between a narrow trading band of 149 points which is its lowest daily range since November 17. Nifty50 formed an inside the bar chart pattern (i.e. traded within prior session’s range), which represents indecisiveness. Nifty's breadth has improved, however, stability is essential to gain some positive traction. As long as the index remains beneath the peak of Friday’s bearish candle (i.e. 17,355), volatile action is likely to continue.

Snapping its four-session losing streak, Bank Nifty rallied 1.8 per cent though it failed to move beyond Tuesday's peak. Minor consolidation is possible, however, the level of 36,900 needs to be taken out on the upside for any revival to set-in

Recommendations

Buy

Godrej Consumer Products

near Rs 935-931
Stop loss: Rs 892
Target: Rs 1,020

After losing 23% from the record peak, the stock rebounded swiftly in the recent past. The appearance of multiple bullish candles ensures an immediate floor near Rs 900. Sustenance at current levels could mean that stock is due for mean reversion to digest its multi-month decline.

Buy

Balrampur Chini

near Rs 330-326
Stop loss: Rs 318
Target: Rs 350

Defending October lows, the stock rebounded forming a bullish candle. Positive follow-up action above Rs 330 could lift the stock to Rs 350 zone.

(The author is CMT, Technical Analyst - Institutional Equities, YES SECURITIES. Views expressed are personal.)