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Monday Market Watch: Uncover Profit Potential with These 2 Stocks – Buy/Sell Recommendations for December 4th
Nifty Outlook
The Long-Short ratio moved from 10.88% on 26th October to 35.75% on 30th November as the Foreign Portfolio Investors (FPIs) increased their exposure to longs and trimmed their exposure to shorts in Index futures. The market's trajectory from the high of 20,222 recorded on September 15th to the low of 18,838 on October 26th spanned 26 trading sessions. Remarkably, the Nifty managed to not only retrace this entire fall but also surpass the previous all-time high within just 25 sessions.
This rapid recovery reveals a compelling narrative - the ascent outpaced the descent, indicating the enduring strength of the underlying bullish momentum. Strong put writing was seen at 20,200 Strike, which led to a sharp up move on an Intraday basis. The near-term resistance for Nifty shifts to the 20,400 level while the level of 20,200 is expected to act as strong support. The Donchian Channel also referred to as the trend-following indicator and the tool for identifying bullish and bearish extremes, shows that the Nifty undertone remains bullish. Nifty is trading above all key moving averages and holds strong support around 20,000 levels. RSI is comfortable holding 74 levels, indicating overall strength.
if the Index crosses 20,350 levels, we could expect the rally to extend to 20,550-20,620 levels in the coming weeks. In contrast, the Bank Nifty finished the week at 44,814.20, up 2.39% from the previous week. A close above 45,100 would trigger further upswing.
Bank Nifty Outlook
Bank Nifty has strong support near 44,200 which corresponds to the 20 EMA. The immediate resistance level has been shifted to 45,600. After a three-month sell-off, FIIs turned net buyers, worth Rs. 3875.8 crore, while DIIs also bought Rs. 14,253.6 crore in November. Bank Nifty rose sharply throughout the day to end at 44,814, up 332 points. The level of 44,500, which acted as a strong resistance earlier, saw call writers exiting and strong put writing, leading to a strong up move in Bank Nifty. However, both the call & put writers battled out at the 45,000 Strike in the Index fiercely. The option activity at the 45,000 level will provide cues about the future direction of Bank Nifty.Bank Nifty has strong support near 44,200 which corresponds to the 20 EMA. The immediate resistance level has been shifted to 45,600. After a three-month sell-off, FIIs turned net buyers, worth Rs. 3875.8 crore, while DIIs also bought Rs. 14,253.6 crore in November. Bank Nifty rose sharply throughout the day to end at 44,814, up 332 points. The level of 44,500, which acted as a strong resistance earlier, saw call writers exiting and strong put writing, leading to a strong up move in Bank Nifty. However, both the call & put writers battled out at the 45,000 Strike in the Index fiercely. The option activity at the 45,000 level will provide cues about the future direction of Bank Nifty."
Stocks To Buy This Week
Buying one IT and one auto stock on Monday, December 4. The following are TCS and Escorts Kubota's entry price, stop loss, and target price.
TCS
Buy TCS in Cash @ Rs 3511.65, stop-loss: Rs 3435, target: Rs 3650 Tata Consultancy Services (TCS) is currently trading at 3511.65 and the Chart suggests that TCS has established strong support near 3435 levels which is just below its 50-Day EMA level. This indicates that the stock has found considerable buying interest around these levels, providing a potential foundation for further upward movement. The Relative Strength Index (RSI) for TCS is currently at 56, indicating that there is still room for potential upside. The stock is trading above all the important moving averages indicating strength. Considering the technical factors and market conditions, it is a favorable opportunity to buy TCS at the CMP of 3511.65 levels. The target for this trade would be 3650, with a recommended stop loss set at 3435.
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