Here's why Vinay Rajani recommends buying Godrej Consumer, Finolex Cables

The technical analyst from HDFC Securities expects the bias for the Nifty to remain positive as long as the NSE index holds above 15,704.

Nifty View

From the day's high of 16,025, the Nifty plunged 240-odd points towards 15,785 during intraday trade on Tuesday.

The Nifty finally ended the session with bearish shooting star candlestick pattern on the daily chart. However, higher top and higher bottom pattern is intact on Nifty daily chart.

As long as the Nifty stays above 15,704, there is a hope of an upward move till 16,173. On the flip side, a breach of 15,500 would accelerate the downward momentum, and that should be kept as stop for all positional longs.

Godrej Consumer

BUY

Last close: Rs 832.25

Targets: Rs 885, Rs 940

Stop Loss: Rs 790

The stock has broken out from its bullish inverted head and shoulder pattern on the daily line chart. The price breakout is accompanied with rising volume.

The stock is trading above its 20- and 50-day EMA. The stock price has also broken out from the downward sloping trend line on the weekly chart. Higher top and higher bottom formation on the daily chart is visible.

 The FMCG sector has started outperforming. Indicators and oscillators have turned bullish on, both, the daily and weekly charts.

The stock can be bought in two tranches one at CMP and second at Rs 800, for targets of Rs 885 and Rs 940, keeping a stop loss at Rs 790.

Finolex Cables

BUY

Last close: Rs 394.10

Targets: Rs 420, Rs 449

Stop Loss: Rs 375

The stock has broken out from the consolidation which it held for the last one week. The stock surged more than 4 per cent with rising volume on July 05, 2022.

The stock has surpassed the crucial resistance of 50-day EMA. Indicators and oscillators have been showing strength on the daily and weekly charts.

The stock can be bought in two tranches one at CMP and second at Rs 380, for targets of Rs 420 and Rs 449, keeping a stop loss at Rs 375.

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