Here's why Vinay Rajani recommends buying ABB India, JK Lakshmi Cement

The technical analyst from HDFC Securities sees the positional trend for Nifty as bullish and expects the index to seek support around 16,400-level.

Nifty View

In the last two trading sessions, the Nifty has been finding resistance at its 50-day EMA, currently placed at 16,690 odd level. From the bottom of 15,740, the Nifty registered a rise of more than 950 points. On May 31, the Nifty ended up the session with “Doji” candlestick pattern on the daily charts, which indicates indecision after healthy rise.

However, positional trend of the market is bullish and dips should be bought in to. The Nifty has got strong support at 16,400 level. On the upside, a level of 16,800 is expected to act as a resistance for the Nifty.

BUY

ABB INDIA

Target: Rs 2,660

Stop Loss: Rs 2,170

Last Close: Rs 2,427

A downward sloping trend line is seen on the daily charts for the stock. The stock price has also broken out from the last three weeks' narrow consolidation and Volumes have been rising along with the price rise. A Higher tops and higher bottoms pattern too has been noticed on the daily charts.

Further, the stock is placed above all important moving averages, indicating a bullish trend on all time frames. The Capital Goods sector has started outperforming. Indicators and oscillators have turned bullish on daily and weekly charts.

BUY

JKLAKSHMI CEMENT

Target: Rs 509

Stop Loss: Rs 405

Last Close: Rs 444

On May 20, 2022, the stock surged more than 10 per cent with a significant jump in volume. The stock has surpassed crucial resistance of its 50-day EMA. The stock has recently seen running correction towards previous breakout levels and it seems like a throwback, which could result in the resumption of the uptrend.

Further, the daily MACD has crossed signal and equilibrium line on the upside. RSI on the daily charts is placed above 50, indicating strong momentum and also a downward sloping channel breakout is seen on hourly charts.

(Vinay Rajani, Senior Technical and Derivative Research Analyst at HDFC securities. Views expressed are personal).