Trading idea by Ajit Mishra: Sell April futures of Motherson Sumi

Motherson Sumi has witnessed a breakdown from a distribution pattern on the daily chart

Buy Bajaj Auto Limited

Last close: Rs 3,678.35

Initiation range: Rs 3,650-3,665

Target: Rs 3,770

Stop loss: Rs 3,600

Within the auto space, Bajaj Auto has witnessed decent correction from its record high and is currently hovering around the support zone of medium-term moving average(100 EMA) on the daily chart. The oversold positions combined with the existense of support are pointing towards the possibility of a rebound soon. Traders shouldn’t miss this opportunity and create fresh longs in the mentioned zone.
 

Buy Britannia Industries Limited

Last close: Rs 3,568.40

Initiation range: Rs 3,535-3,550

Target: Rs 3,740

Stop loss: Rs 3,460

BRITANNIA has been seeing correction for the last nine months, after making a new record high at 3,940.44, in July 2020. It has recently tested the monthly support zone around 3,300 and is witnessing a gradual rebound. Indications are in the favor of prevailing recovery to continue and possibly the resumption of the uptrend too. We, thus, suggest traders to initiate fresh long positions in the given range.
 

Sell April Futures of Motherson Sumi Systems Limited

Last close: Rs 212.50

Initiation range: Rs 212-214

Target: Rs 197

Stop loss: Rs 221

MOTHERSUMI has witnessed a breakdown from a distribution pattern on the daily chart and is likely to test the support zone of the short-term moving average(50 EMA) soon. The prevailing corrective phase in the benchmark combined with the mixed indication from the auto index is further adding to the negativity. We thus advise creating fresh shorts in the given range.

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Disclaimer: Ajit Mishra is VP - Research at Religare Broking

http://www.religareonline.com/disclaimer