Buy PFC, Power Grid; Sell Bajaj Finance May futures, recommends Ajit Mishra

Ajit Mishra, SVP-Research of Religare Broking expects the Nifty to face resistance in the 22,300 - 22,400 range.

Nifty View: 22,200.55

Following three days of rebound, the markets took a pause and closed nearly unchanged. Initially, there was an uptick, but pressure from certain heavyweights pushed the Nifty lower, leading to a range-bound movement until the end of the session.

Meanwhile, a mixed trend prevailed on the sectoral front, with energy and realty sectors witnessing gains while the FMCG and auto sectors ended in the red. However, the broader indices managed to post modest gains ranging from 0.5 per cent to 1 per cent.

We maintain our cautious outlook on the Nifty index, highlighting the resistance in the 22,300-22,400 zone, and suggest continuing with a stock-specific trading approach. In addition to domestic factors, it's advisable to closely monitor the US markets for cues.

Stocks Recommendations

BAJAJ FINANCE

LTP: Rs 6,695

RECO: SELL MAY FUTURES

Target: Rs 6,500

Stop-loss: Rs 6,785

Bajaj Finance has been undergoing a corrective phase over recent weeks, marked by a pattern of forming higher highs and lows. Recently, it faced selling pressure, encountering resistance near a descending trendline.

Additionally, slipping below its short-term moving average and trading under its previous swing low suggests weakness in the trend, indicating a continuation of bearish sentiment.

POWER FINANCE CORPORATION

LTP: Rs 436.80

RECO: Buy

Target: Rs 465

Stop-loss: Rs 423

We're witnessing notable interest in power-related stocks, and from a technical perspective, PFC presents a buying opportunity. The stock has quickly rebounded, finding support around the neckline of an inverse head and shoulders pattern, which aligns with the moving average ribbon, indicating a robust support zone.

Given the recent price action and increase in volume, we anticipate the price to ascend, potentially reaching its previous swing high.

POWER GRID CORPORATION OF INDIA

LTP: Rs 315.00

RECO: Buy

Target: Rs 335

Stop-loss: Rs 305

POWERGRID has been experiencing a consistent uptrend accompanied by a gradual increase in trading volumes. It has recently bounced upwards, finding support near its previous resistance level, which also aligns with its short-term moving average and has approached its all-time high. We anticipate this prevailing trend to persist.

Disclaimer: Ajit Mishra, SVP-Research, Religare Broking Ltd. Views expressed are personal.

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