Benchmark stock market indices have been on a remarkable upward trajectory in recent trading sessions, achieving record highs last week. The BSE Sensex and NSE Nifty 50 have both reached unprecedented levels, with the Sensex surpassing 67,800 in the previous trading session on Friday, while the Nifty concluded near the 20,200 mark.
Although both indices have retraced from their record highs on Monday, market analysts maintain an optimistic outlook and anticipate the markets will sustain their robust performance.
According to Avdhut Bagkar, an expert in Derivatives and Technical Research (Institutional) at Stoxbox, "The benchmark indices, Nifty 50 and BSE Sensex have exhibited resilience over the key levels of 19,000 and 64,000. This persistence has triggered a fresh upside when both recently reached a new historic peak."
"From a technical perspective, the overall trend is directed towards 25,000 for the Nifty 50 and 80,000 for the BSE Sensex, which are expected to converge in 2024. In the case of Nifty, immediate support can be found in the range of 19,200 to 19,000, followed by 18,450, its 200-simple moving average (SMA)," he explained.
Likewise, Bagkar noted that the BSE Sensex has a support range spanning from 65,000 to 64,500 levels, followed by 62,280 - the 200-SMA. He added that the broader trend remains "highly optimistic, with substantial contributions expected from Nifty mid and smallcap indices."
In celebration of Ganesh Chaturthi, Bagkar has recommended three stocks with over 25 per cent upside potential.
1. Stock A: Despite a more than 70 per cent surge this year, the momentum is expected to persist in the coming months. An "Ascending Triangle" breakout in July has driven the stock into bullish territory, propelling it over the immediate resistance at Rs 5,200.
The technical analysis suggests an overall trend aiming for the Rs 8,000 mark, with support levels at Rs 4,800 to Rs 4,700.
2. Stock B: After reaching a new all-time high at Rs 5,333, the stock has found stability around Rs 4,800, the breakout point of the bullish rally. This represents robust support, affirming the positive trend direction towards Rs 6,300 and Rs 7,500, with a price stop loss set at Rs 3,450.
3. Stock C: The broader outlook validates the support of the 200-SMA at Rs 145. The consolidation breakout from the range of Rs 200 to Rs 155 in early August has established a bullish outlook for the coming months. Additionally, the positive crossover of the 100-SMA with the 50-SMA negates significant downside risks, as indicated by the daily chart.
Hence, an advisable strategy is to buy at the current market price of Rs 228 with a target price of Rs 285.
