Big movers on D-Street: What should investors do with Zomato, HUL and Dabur?

Rising for the fifth straight day, benchmark BSE Sensex spurted by 809 points in a choppy trade on Thursday a day ahead of the announcement of the RBI policy review.

Stocks that were in focus include names like Zomato, which rose 4.4% and HUL, which gained 0.4% and Dabur, whose shares jumped 1.3% on Thursday.

Here's what Kushal Gandhi, Technical Analyst at StoxBox, recommends investors should do with these stocks when the market resumes trading today.

Zomato

The share price of Zomato appears promising, suggesting a continuation of a steeply positive primary price trend and favorable developments. Recently, the price action took a breather, entering a sideways trend that formed a round bottom pattern, which is typically indicative of potential trend continuation. In the previous trading session, the stock staged a bullish breakout on relatively higher volumes, further supporting this positive shift.

The stock demonstrates strong earnings per share (EPS) and impressive price strength, alongside a notable increase in buyer demand, which is encouraging news. On the technical front, indicators such as the MACD in both daily and higher timeframes point to a likely continuation of the positive trend.

Additionally, the RSI on these timeframes is trading well above the median, indicating the potential for further bullish momentum. Therefore, we recommend purchasing shares of Zomato with a target price of 340, while maintaining a protective stop at 274.

HUL

The share price of HUL has experienced a decline of 659 points from its record highs over the past 38 trading sessions. The current price action suggests a potential attempt to form an intermediate bottom, with the 200 Weekly MA now serving as immediate support.

There are indications of increasing bullish strength as the stock makes an effort toward a trend reversal, with 200 DMA acting as immediate overhead resistance. The RSI across daily and higher timeframes is trading below the median levels, signaling diminishing price momentum.

Additionally, there is a noticeable lack of EPS and price strength, with buyer demand remaining relatively low currently. Therefore, we recommend purchasing shares of HUL upon receiving a technical confirmation of a decisive close above 200 DMA, which is currently trading near 2539.

Dabur

The share price of Dabur currently reflects a bearish trend, as it is trading below key moving averages such as the 200, 100, and 50 Daily and Weekly MA, indicating a negative development. Recently, the stock has experienced a decline of nearly 26% over 42 trading sessions, followed by a mean revision towards the short-term MA due to its oversold condition.

However, the shorter-term moving averages continue to function as immediate resistance, hindering any attempts at recovery amidst the prevailing downtrend. The stock exhibits significantly bearish price momentum, earnings per share (EPS), and price strength, resulting in extremely weak buyer demand. Therefore, we advise against purchasing Dabur at this time.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)