Leading Stocks to Consider for Purchase Next Week: Focus on Bullish Trends
According to Sudeep Shah, Head of Technical Research and Derivatives at SBICAP Securities, Apollo Hospitals Enterprise and LT Foods are the top stock recommendations for the upcoming week. Shah’s insights also cover the performance outlook for Nifty and Bank Nifty, indicating a bullish trend that investors should consider as they plan their strategies for the next three months.
Nifty Performance Analysis
The Nifty index has recently broken out of a prolonged consolidation phase, which lasted for 31 trading sessions. This breakout occurred after a period of silent pressure, culminating in a significant upward movement that pushed the index above the 25,600 mark, reflecting a gain of 2.09% for the week. This surge marks the highest weekly close since September 2024, suggesting that the breakout is not merely a temporary spike but a structural shift in market dynamics.
The weekly chart reveals a substantial bullish candle, indicating strong momentum and renewed buying interest among investors. This breakout is supported by positive trends across various sectors, including Financial Services, Private Banks, Oil & Gas, Infrastructure, and Auto, many of which have also exhibited breakout patterns. With robust technical indicators and broad sector participation, the Nifty appears well-positioned to continue its upward trajectory, with potential targets of 25,800 and 26,100 in the near term. Conversely, the 25,400 to 25,350 range is expected to act as a support zone in case of any immediate pullbacks.
Bank Nifty Outlook
The Bank Nifty index has shown remarkable strength, recently achieving fresh all-time highs over the last two trading sessions. This performance stands in contrast to the broader Nifty index, which remains approximately 2.5% below its peak. The relative outperformance of Bank Nifty underscores the strong leadership from banking stocks within the market.
A significant bullish signal has been the recent breakout from a Stage-2 cup pattern on the daily chart, a formation that typically precedes a strong upward trend. The Bank Nifty continues to trade above all key short-term and long-term moving averages, indicating solid price support. Additionally, momentum indicators such as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) are firmly in bullish territory across both daily and weekly timeframes. This alignment of breakout patterns, moving average support, and strong momentum suggests that Bank Nifty is likely to maintain its bullish trend, with an upside target set at the 59,000 level. On the downside, the 56,800 to 56,700 range is anticipated to provide a cushion against any immediate declines.
Stock Recommendations for Investors
Among the recommended stocks, Apollo Hospitals Enterprise stands out as a strong buy. Currently trading at ₹7,308.5, the stock has shown a breakout from an Ascending Triangle pattern, supported by robust volume, indicating strong buying interest. Investors are advised to accumulate shares in the range of ₹7,320 to ₹7,280, with a target price of ₹7,900 and a stop-loss set at ₹7,000. This recommendation reflects an expected return of approximately 8.09% over a three-month period.
Another notable recommendation is LT Foods, which is currently priced at ₹483.25. The stock has recently bounced back from its 100-day Exponential Moving Average (EMA), indicating a strong reversal from a crucial demand zone. Investors should consider accumulating shares in the range of ₹485 to ₹480, with a target price of ₹540 and a stop-loss at ₹450. This strategy suggests a potential return of around 11.74% over the same three-month timeframe.
Overall, these insights and recommendations provide a roadmap for investors looking to navigate the current market landscape effectively.
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