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Stocks to Buy: ICICI Bank and DLF look attractive, and here’s why

Vaseline 4 weeks ago

Indian stock market: A pervasive line pattern has appeared on the daily chart, usually indicating a bullish reversal after the correction. Moreover, the indicator has crossed the 55EMA, indicating a positive short-term trend with a close above this moving average. In the coming period, the bullish momentum could propel the Nifty’s recovery towards 22,300. Moreover, a strong break above 22,300 could initiate a prolonged rally towards 22,600. Conversely, at the downside, the closing support is at 22,000.

Bank Handy

The Bank Nifty Index showed robust bullish momentum, evidenced by the formation of a bullish penetrating candlestick pattern at the support level of 46,500. The index faces immediate resistance at 48,000, with substantial open interest on the call side providing a notable obstacle. Between 47,200 and 47,000, the index has provided immediate support. Pullbacks towards this support zone are seen as buying opportunities, indicating continued bullish sentiment as long as these levels remain intact.

Stocks to buy

ICICI Bank: Buy at 1,070 | Target price: 1,125 | Stop Loss: 1,044

The daily chart shows a pervasive line pattern, suggesting the possibility of a bullish reversal. Moreover, the share has again risen above the critical short-term average. The shorter time frame RSI (14) indicates a bullish crossover and is on the rise. Moreover, a hidden bullish divergence is visible on the daily chart. In the short term, the stock could potentially move towards 1,105/1,125 and beyond. Support is at 1,044 on the downside.

The stock has risen to close above both the previous swing high and a formidable resistance level at 126. With its current trading position above the short-term 21-day average, the bullish momentum is clearly visible. This sentiment is further supported by the Relative Strength Index (RSI), which has undergone a bullish crossover and reached 69. Considering these factors, initiating a long position at the current market price seems beneficial. Setting a stop loss at 122 and a target at 135 reflects a bullish outlook for the stock.

DLF: Buy up 855 | Target price: 900 | Stop Loss: 829

The stock has dipped into the oversold zone on the hourly chart, as indicated by its RSI positioning. Furthermore, the RSI is showing a bullish divergence on the hourly chart, indicating a possible bullish reversal. Additionally, the stock appears to be finding support around the prior congestion on the daily time frame. Taken together, the technical setup implies a potential exhaustion of the current bearish trend and an impending recovery.

The author Rupak De is a Senior Technical Analyst at LKP Securities.

Disclaimer: The above views and recommendations are those of individual analysts, experts and brokerage firms, not Mint. We advise investors to contact certified experts before making investment decisions.



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