Stocks to buy & sell: Raja Venkatraman recommends three stocks for today — 14 January

Nifty 50 on 13 January: Recap

On 13 January, the Indian stock market saw a significant decline, with benchmark indices Nifty and Sensex plunging due to intensified broad-based selling. Mid and small-cap indices took a severe hit, with losses of around 4%. The fear of disappointing earnings reports could further dampen market sentiment. Global factors, including a negative US jobs report and rising dollar index, contributed to the turmoil. The Indian rupee weakened, opening at a record low of ₹86.18 against the dollar, adding to the market's woes.

Indian stock markets: Way forward

Currently, leveraged positions (long) are shed and some shorts are also in place. This can facilitate more declines as people can join the short side if a break below 24100 emerges. Equally, it can present us with a bullish scenario if supports turn out to be favorable. People are much quicker to create fresh longs than fresh shorts, as a norm. Market men are pushing for a decline than an advance. The ADX and DMI are seen generating a bearish trend and will continue to attract more sell-off on rallies to higher levels. Hence, any advances that emerge must be considered a sell opportunity. With the open interest data indicating further deepening of the oversold status, we should step back from bullish bias till we obtain some clarity.

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Three stocks to trade, recommended by NeoTrader’s Raja Venkatraman:

• Voltas: Sell rallies to ₹1650, stop ₹1675, target ₹1590

After a sharp breakdown in this counter, the revival in the prices looks limited. As the selling pressure intensifies, the constant supply could drag prices lower. Currently, the trends show signs of exhaustion and will have an upward bound from supports; the potential for moving higher emerges, and look to buy into this market. One can look to participate as trends have turned negative after the value area breakdown.

• Kitex: Buy ₹ 715, stop ₹695 target ₹765

While the markets, especially the midcaps, have been facing the heat, this counter managed to withstand the pressure and is now showing signs of revival. The strong showing on Monday despite the avalanche of selling across market highlights the probability of some trended action, the trends in the associated stocks have been on the decline. The sharp move above the cloud region in the intraday timeframe suggests that some steady ascent is possible in the next few days.

• Tata Communications: Sell below ₹1,630 and rally near ₹1,660, stop ₹1675, target ₹1590

This telecom counter after long period of consolidation shows the selling pressure has gained significance momentum as the trends began to gather steam and tread lower indicating a steady resolve. On Monday the sharp decline is indicating the onset of a new phase. Also, with the Relative Strength Index (RSI) showing more weakness one can look to sell now and on rallies.

Raja Venkatraman is co-founder, NeoTrader.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.

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