Vinay Rajani recommends to buy HCC, Nava as stocks crossed key resistances

On the broader market outlook, the technical & derivative analyst from HDFC Securities suggests that the trend for Nifty is still bearish.

Nifty View

From the recent swing low of 17,774, the Nifty has gradually moved up in last few sessions towards 18,234 level. The Nifty is still placed below its 20 and 50 days SMA, with 20 DMA is sloping downward. Lower tops and lower bottoms are also intact, which indicates bearish trend.

To negate the downtrend, the Nifty has to convincingly surpass 18,500 resistance. On the downside, strong support is seen at 17,800. 

BUY

HCC

Last close: Rs 21.45

Targets: Rs 23.5; Rs 27

Stop Loss: Rs 18.90

The stock price has surpassed crucial resistance of multiple top placed at Rs 20. The stock has resumed its primary uptrend after a running correction. Price breakout is accompanied with rising volumes. Stock price has been forming higher tops and higher bottoms on the daily charts.

The stock price is placed above all important moving averages. Indicators and oscillators have tuned bullish on daily and weekly charts. Infrastructure and construction stocks have started outperforming and are expected to outperform in the short to medium term time frame.

BUY

Nava

Last close: Rs 255.40

Targets: Rs 280; Rs 305

Stop Loss: Rs 240

The stock found strength on chart on December 15, 2022, when it surpassed the resistance of 50 days EMA with significant jump in price and volumes. Post breakout, the stock started forming higher tops and higher bottom formation on the daily chart turned bullish on medium term charts as well.

The stock is on the verge of surpassing the all time high level of Rs 279, registered on August 18, 2022. Metal sector has recently picked up the momentum and Nifty Metal Index has registered new all-time high. Indicators and oscillators have turned bullish on daily and weekly charts.

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