The Indian stock market closed in the red for the third consecutive day despite strong buying in IT stocks following TCS Q3 results. The Nifty 50 index dropped by 95 points, closing at 23,431, while the BSE Sensex fell by 241 points, ending at 77,378. The Bank Nifty index nosedived 717 points, settling at 48,785. Broader market sentiment remained bearish, with the BSE advance-decline ratio at 0.26, reflecting a sharp decline in advancing stocks compared to declining ones.
In this turbulent market, Sumeet Bagadia, Executive Director at Choice Broking, highlighted key trading opportunities with a stock-specific approach. Bagadia identified Tech Mahindra, JSW Steel, and Bajaj Finserv as potential picks for investors looking to capitalize on bullish setups.
Top Stock Picks for Next Week
1. Tech Mahindra (₹1705.60)
- Recommendation: Buy
- Target: ₹1860
- Stop Loss: ₹1628
Tech Mahindra shares are trading at ₹1705.60 and continue to exhibit a long-term uptrend. The stock recently formed a Double Bottom pattern, a classic bullish reversal signal, near its demand zone. A strong bullish candle on the daily chart, supported by increased trading volumes, suggests positive market participation.
The RSI at 49.27 is trending upwards with a positive crossover, indicating momentum in favor of buyers. Additionally, the stock has surpassed its 20-day and 50-day EMAs, reinforcing the bullish outlook. Investors can buy Tech Mahindra shares at the current level with an upside target of ₹1860, while placing a stop loss at ₹1628 to manage risk effectively.
2. JSW Steel (₹900.10)
- Recommendation: Buy
- Target: ₹980
- Stop Loss: ₹860
JSW Steel shares have shown resilience by bouncing from their crucial support zone, trading at ₹900.10. The stock’s RSI is at 38.54, reversing positively from lower levels, indicating the possibility of upward momentum.
Although the stock is trading below its 20-day, 50-day, and 200-day EMAs, a breakout above these levels would confirm a sustained bullish trend. If the stock sustains above ₹925, it could rally toward ₹980, backed by improving momentum indicators.
Investors are advised to buy JSW Steel shares at ₹900.10 with a stop loss at ₹860. This setup offers an attractive risk-reward ratio, with the potential for significant gains upon crossing key resistance levels.
3. Bajaj Finserv (₹1701.25)
- Recommendation: Buy
- Target: ₹1875
- Stop Loss: ₹1620
Bajaj Finserv shares, trading at ₹1701.25, have recently broken out of a consolidation phase. This breakout, coupled with increased trading volumes, highlights strong buying interest. If the stock sustains above the ₹1750 level, it could head toward its next target of ₹1875.
The RSI at 62.09 remains bullish without entering overbought territory, leaving room for further upside. Bajaj Finserv shares are also trading above their 20-day, 50-day, and 200-day EMAs, confirming a positive trend.
Investors can consider buying Bajaj Finserv shares at the current level with a stop loss of ₹1620 and a target price of ₹1875.
Market Outlook
As the Nifty 50 index breaks its crucial support at 23,500, Sumeet Bagadia advises investors to adopt a stock-specific strategy while keeping an eye on broader market trends. These three stocks—Tech Mahindra, JSW Steel, and Bajaj Finserv—offer promising opportunities for investors amid the current bearish market sentiment.