Vinay Rajani of HDFC Securities is positive on M&M, Timken India; check why

M&M closed with a bullish engulfing pattern on the daily chart with a jump in volumes

Nifty broke two sessions' losing streak by rising more than 80 points on Tuesday. The index made a low at 17,345, which happens to be 23.6 per cent Fibonacci retracement of the entire rise seen from 15,183 to 17,992. The Nifty index also found support on its 21-day EMA (exponential moving average) and reversed north.

Meanwhile, the Nifty Bank index closed with a bullish engulfing pattern on the daily chart, which indicates bullish trend reversal after running correction. The Nifty should be held long with a stoploss of 17,400.

Stock picks:
 

Buy M&M (Rs 1,273) | Targets: Rs 1,320 and Rs 1,380 | Stop-loss: Rs 1218

The stock found support on its 21-day EMA and reversed north. Moreover, it closed with a bullish engulfing pattern on the daily chart with a jump in volumes. Primary trend of the stock has been bullish. The stock is placed above all important moving averages, which indicates bullish trend on all time frames.

Buy Timken India (Rs 3,014) | Targets: Rs 3,140 and Rs 3,300 | Stop-loss: Rs 2,810

The stock has given a bullish "Flag" pattern breakout on the daily chart with rising volumes. Moreover, it has been forming higher tops and higher bottoms on the weekly charts. Indicators and oscillators have been showing strength in the current uptrend.

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Disclaimer: Vinay Rajani is a Senior Technical and Derivative Research Analyst at HDFC securities. Views expressed are personal.