Buy or sell: Sumeet Bagadia recommends three stocks to buy on Monday — 6 January 2025

Buy or sell stocks: Following weak global market cues on selling in the US stock market for five straight sessions, the Indian stock market ended lower on Friday. The Nifty 50 index lost 183 points but sustained above the crucial 24,000 mark. The BSE Sensex nosedived 773 points and closed at 79,170, while the Nifty Bank index crashed 632 points and finished at 50,972. Among sectors, Media, Oil & Gas, and Consumer Durables led the gainers, while IT, Pharmaceuticals, and Banking sectors faced the most substantial selling pressure. The broader markets showed relative resilience, with the Nifty Mid-cap and Smallcap 100 indices declining by 0.3% and 0.24%, respectively, outperforming the benchmark’s 0.76% fall. Market breadth remained positive for the fourth consecutive session, with an advance-decline ratio of 1.13.

Sumeet Bagadia’s stock recommendations

Sumeet Bagadia, Executive Director at Choice Broking, believes the Indian stock market bias remains cautiously positive. The Nifty 50 index has sustained above 24,000, with crucial support placed at 23,900 to 23,850. The Choice Broking expert said the 50-stock index is currently in the 200-DEMA to 50-DEMA range. Bagadia also said the frontline index is facing resistance at the 24,200 mark—the 50-DEMA level.

Stocks to buy next week

Regarding buy or sell stocks for Monday, Sumeet Bagadia recommended buying these three shares: Nestle India, Reliance Industries, and Maruti Suzuki India.

1] Nestle India: Buy at ₹2232.70, target ₹2415, stop loss ₹2140.

Nestle India share price is currently trading at ₹2232.70, forming a strong bullish candle on the daily timeframe, indicating a positive shift in momentum. The stock recently experienced a correction after breaking down from a consolidation range at higher levels. However, it has shown signs of stability near its demand zone, suggesting potential support and a reversal setup.

A sideways movement near the demand zone, followed by a bullish reversal, is accompanied by consistent trading volumes, further supporting the ongoing recovery. If Nestle India’s share price manages to sustain above the ₹2260 mark, it could confirm a trend reversal and indicate a stronger bounce back, potentially attracting fresh buying interest above this critical level.

The Relative Strength Index (RSI) currently stands at 54.85, reflecting an uptrend after a lower-level reversal, reinforcing the improving market sentiment.

Nestle India’s share price has also reclaimed its short-term (20-day) EMA levels and is now trading near its medium-term (50-day) EMA. A sustained breakout above the medium-term EMA could open the door for a retest of its long-term (200-day) EMA, further confirming bullish strength.

Considering the current technical setup, a buying opportunity is visible at the current price of ₹2232.70. A stop-loss is placed at ₹2140 to manage downside risks. The upside target for this trade would be ₹2415, aligning with the expected continuation of the positive momentum.

2] Reliance Industries Limited: Buy at ₹1251.15, target ₹1350, stop loss ₹1200.

Reliance share price currently trades at ₹1251.15, showing signs of a potential reversal from its demand zone. The stock has been under selling pressure recently, forming a pattern of lower highs and lower lows, indicating a corrective phase. However, it has shown a pause near the demand zone, with sideways price action suggesting a possible trend stabilization.

A bullish setup is emerging as RELIANCE has recently surpassed its short-term (20-day) EMA, indicating the possibility of a trend shift. For a confirmed upside breakout, the stock must sustain above the ₹1280 level, which could trigger a bounce toward the ₹1350 mark, a significant resistance zone. Sustained buying interest above this level would further strengthen the bullish outlook.

The Relative Strength Index (RSI) is currently at 49.22, rebounding from lower levels and nearing the buying zone. This suggests potential for further upside momentum, with room for additional strength if the stock continues holding above key support levels. The improving RSI, coupled with price stability, indicates a shift in sentiment.

Considering the current technical setup, a buying opportunity is visible at the current price of ₹1251.15. A stop-loss can be placed at ₹1200 to manage downside risk, while the upside target remains ₹1350. This aligns with the following significant resistance and the potential continuation of the emerging bullish trend.

3] Maruti Suzuki: Buy at ₹11934.25, target ₹13150, stop loss ₹11350.

Maruti Suzuki’s share price is currently trading at ₹11,934.25, having recently witnessed a strong reversal move on the daily timeframe, reflecting bullish momentum. The stock remains in a long-term uptrend, indicating continued strength in its price action. After marking a record high, MARUTI experienced a throwback from higher levels, consolidating within a range. However, it has recently shown a breakout from this consolidation pattern, forming a double-bottom structure and a bullish reversal sign.

This breakout has been supported by a significant rise in trading volumes, adding further credibility to the upward move. Increased participation during the breakout indicates strong buying interest, suggesting a continuation of the positive momentum. If Maruti Suzuki share continues to hold above its breakout levels, the stock could witness further upside potential soon.

The RSI currently stands at 69.40 and is trending upwards, indicating strong buying momentum. Additionally, Maruti Suzuki’s share price has bounced back from its support zone and successfully surpassed all key moving averages, including short-term (20-day), medium-term (50-day), and long-term (200-day) EMAs. This alignment further reinforces the bullish outlook, with the stock showing technical strength across multiple timeframes.

Considering the current market setup, buying is recommended at ₹11,934.25, with a stop-loss set at ₹11,350 to manage risk effectively. The upside target is ₹13,150, aligning with the stock’s bullish breakout and strong technical indicators.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.

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