Day Trading Guide: 2 stock recommendations for Friday

Aditya Agarwala, YES Securities

The Nifty50 ended a volatile weekly expiry session marginally higher after failure to trade above its key resistance zone of 17,350-17,400 following a 150 points gap up opening.

However, bulls did manage to keep the index above the key support zone of 17,200 -17,170, which happened to be the 61.8% Fibonacci retracement level. A sustained trade beyond this key support area in the coming trading sessions may trigger a short-covering rally taking it back to levels of 17,350-17,400, which happens to be the upper end of the trading range. However, failure to sustain above 17,170 may resume the corrective phase dragging the index lower to levels of 17,025. Moreover, relative strength index (RSI) on a shorter time frame has taken support at the 35 levels and turned upwards after forming a positive divergence confirming that the uptrend is still active.


Equity recommendations:

HCL Tech
BUY at CMP: Rs 1,160
Target: Rs 1,200
Stop Loss: Rs 1,140
The stock resumed uptrend after breaking out of a narrow consolidation zone on healthy volumes confirming the bullishness. The RSI has also turned upwards from the lower end of the bull zone.

PVR
Sell at CMP: Rs 1,358
Target: Rs 1,275
Stop Loss: Rs 1,400
The stock has broken down from a bearish flag pattern resuming its downtrend. Further, it has also closed below its 200-DMA, suggesting extended weakness.

(The author, Aditya Agarwala, CMT is Technical Analyst–Research at YES Securities)