Stock market today: Trade setup for Nifty 50 to US Fed rate cut, five stocks to buy or sell on Monday — August 26

Stock market today: The Indian stock market finished on a higher note despite trading sideways throughout the week. The Nifty 50 index finished at 24,823, logging a weekly gain of 283 points or 1.15 per cent. The BSE Sensex ended with a weekly gain of 0.80 per cent or 650 points at 81,086. The Bank Nifty index recorded a weekly gain of around 0.83 per cent and closed at 50,933. In the broad market, the Small-cap and Mid-cap indices outperformed the frontline Indian indices. The Small-cap index recorded a weekly gain of around 3.40 per cent, whereas the Mid-cap index registered a 1.95 per cent rise last week.

Trade setup for Monday

Speaking on the outlook of Nifty today, Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, said, "The underlying trend of Nifty continues to be choppy with a positive bias. A further upmove from here could pull Nifty towards 25000-25100 levels in the near term. Immediate support is at 24650."

On the outlook of Bank Nifty today, Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C Mehta, said, "The Bank Nifty opened on a positive note but encountered trend line resistance, leading to profit booking, and eventually settled the day on a negative note at 50,933 levels. Technically, the Bank Nifty has formed a red candle near the trend line resistance around 51,200 levels. However, the index held above its 21-DEMA support, near the 50,790 level. The index has formed a bullish candle on the weekly scale, indicating strength. As long as the index holds above 50,790, a "buy on dips" strategy is advisable. On the upside, trend line resistance near 51,200 levels remains a key barrier. Sustaining above 51,200 could open the path towards the 51,500 to 51,800 levels."

US Fed rate cut buzz

Expecting a positive trend to continue in the Indian stock market, Naveen Kulkarni, Chief Investment Officer at Axis Securities PMS, said, “The recent comments from the US Federal Reserve chairman regarding interest rates were not surprising. The market expects an interest rate cut during the next Federal Reserve meeting in September. The big question is how quickly the rates will be reduced. There are indications that the rate cuts could happen faster, especially with the weakening of jobs data. However, Powell believes the chances of the US economy entering a recession soon are very low. This implies that rate cuts would likely align with consensus expectations, and the possibility of higher rates may be lower. Overall, the regime of high interest rates is coming to a close. Still, the likelihood of returning to an ultra-low interest rate environment also appears low.”

Stocks to buy today

Regarding shares to buy today, stock market experts Sumeet Bagadia, Executive Director at Choice Broking, and Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, recommended buying Welspun Enterprises, TVS Electronics, Swan Energy, Tata Motors, and Jindal Steel.

Sumeet Bagadia's stocks

1] Welspun Enterprises: Buy at ₹601.25, target ₹633, stop loss ₹580.

Welspun Enterprises, presently trading at an all-time high of ₹610, is displaying significant bullish momentum. Substantial trading volumes have backed the recent breakout above the critical resistance at ₹575, an essential technical development highlighting the strength of the stock. The discovery raises the possibility that the upward trend would continue, providing investors with a positive outlook.

2] TVS Electronics: Buy at ₹@ 445.90, target ₹469, stop loss ₹430.

The daily chart analysis of TVS Electronics reveals a promising outlook for the upcoming week, signalling a sustained upward movement. Notably, the stock has formed a significantly higher high and higher low pattern, and the recent upward swing has successfully breached the neckline, establishing a new week high for the stock. This breakout suggests the potential for a substantial follow-through upward movement in the stock price.

Ganesh Dongre's shares to buy today

3] Swan Energy: Buy at ₹700, target ₹745, stop loss ₹680.

A notable bullish reversal pattern has emerged in the stock's recent short-term trend analysis. This technical pattern suggests a temporary retracement in the stock's price, potentially reaching around ₹745. The stock is currently maintaining a crucial support level at ₹680. Given the current price of ₹700, a buying opportunity is emerging. This suggests that investors consider purchasing the stock at its current price, anticipating a rise towards the identified target of ₹745.

4] Tata Motors: Buy at ₹1088, target ₹1130, stop loss ₹1065.

On the daily chart of this stock, a breakout at the Rs. 1088 price level has been observed, signalling a potential upward trend. Complementing this breakout, the Relative Strength Index (RSI) is still turning up, indicating increasing buying momentum. Given these technical indicators, traders can consider buying on dips, entering the stock at a lower price point. To manage risk, a stop loss of ₹1065 is recommended. The target price for this strategy is ₹1130 in the upcoming weeks, suggesting a potential gain as the stock continues its upward trajectory.

5] Jindal Steel: Buy at ₹960, target ₹990, stop loss ₹940.

On the short-term chart, this stock is forming an inherently bullish rounding bottom pattern. Currently priced at ₹960, this formation signals a potential upward trend. To effectively manage risk, a stop loss of ₹940 is recommended. The target price for this strategy is ₹990 in the upcoming weeks. This suggests a potential gain as the stock continues its upward trajectory, backed by the bullish technical signals.

Disclaimer: The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.