Day trading guide: 2 stock recommendations for Monday

Post the previous Monday’s swift rally, Nifty swung between 15,670-15,900 zone through the rest of the week. On Friday, Nifty closed at 15849, up 59 points, forming another bullish candle. Recent rebound from the lower levels indicates an immediate floor near 15700-15635 levels, while positive follow-up action is required to attempt 15975. Nifty's breadth remained mildly positive, moreover, all the sectoral indices ended in the green, except the FMCG index.

Bulls regained momentum in the banking space. Except for Kotak Bank and Bandhan bank, all the components of Bank Nifty ended in positive territory. Bank Nifty rose significantly, gaining 1.5 per cent in Friday’s trade and 2.3 per cent for the week gone by. Levels of 35000 could turn out as immediate floor, while on the higher side, it might inch higher till 35800-36000 zone.

Within the banking space, the PSU Bank index outperformed most (up 5.3 per cent this week); a stock-specific rally within the public banking space is likely to continue.


Recommendations:

Buy Manappuram Finance near Rs. 164-163

• Stop loss: Rs. 159
• Target: Rs. 174

Forming a series of ascending tops and bottoms, bulls have regained momentum on the upside. Positive follow-up action could lift the stock towards Rs. 174 zone.

Buy Godrej industries near Rs. 570-566

• Stop loss: Rs. 549
• Target: Rs. 600

A sustained move above important averages is likely to keep the near-term structure positive. The appearance of a bullish weekly candle could resume the uptrend.

(Amit Trivedi, CMT, Technical Analyst - Institutional Equities, YES Securities)