Big Movers on D-St: What should investors do with L&T, Shoppers Stop and Tata Motors?

Indian market snapped its 2-day losing run on Wednesday to close with gains of nearly 1 per cent. The S&P BSE Sensex rose more than 500 points while the Nifty50 closed above 16,600 levels.

Sectorally, the rally was seen in healthcare, capital goods, public sector, IT, and banks while some selling was seen in telecom stocks.

Stocks that were in focus include names like L&T which closed with gains of nearly 3 per cent post Q1 results, Shoppers Stop which rallied over 7 per cent, and Tata Motors which ended with muted gains ahead of results.

Here's what Viral Chheda, Technical Analyst, SSJ Finance & Securities recommends investors should do with these stocks when the market resumes trading today:

L&T: Target Rs 2095-2300 in the next 6-8 months
After making a low of Rs 661 in March 2020, the stock has given a sharp rally to make an all-time high of Rs 2078 in January 2021 on the longer-term chart.

During this period, the price has made a Higher Top and Higher Bottom pattern. From a high of Rs 2078, the price has witnessed selling pressure as it retraced almost 44 per cent of the previous rally to make a low of Rs 1456 odd level.

In this correction, the price has moved in a Parallel Channel. The price breached the pattern on the higher side and a close above the 50-WMA of Rs 1756 can fuel a further upside rally.

The stochastic Oscillator is moving in an upward trend along with rise in volumes indicating upward movement with limited downside risk.

One can buy the stock at the current price and more on dips towards Rs 1695 for an upside level of Rs 2095-2300 in the next 6-8 months.

Hence, we recommend buying at this level and more on dips towards Rs 1695 with a stop loss of Rs 1590 on a weekly closing basis. On the upside, we can see levels of Rs 2095-2300 in the next 6-8 months.

Shopper Stop: Target Rs 680-760 in the next 6-8 months
On the daily chart, we can see from November 2021 to March 2022, the stock moved in a range of Rs 295-390 odd levels. After making a double bottom pattern around Rs 295, the price gave a sharp upside move and breached the consolidation phase on the higher side to make a 3-year high of Rs 598 in April 2022.

It witnessed some profit booking thereafter as it retraced almost 66 per cent of the previous rally to make a low of Rs 396 odd level.

After moving sideways for a few weeks with high volumes, the price gave a sharp upside rally and on 26th July it gave a major breakout to make a new high of Rs 605 level and from here further, the upside can be seen.

RSI Oscillator shows positive divergence on chart and increase in volume indicates further upside from here. One can buy at the current price and more at dips of Rs 550 for an upside level of Rs 680-760 in the next 6-8 months.

Hence, we recommend buying at this level and more at dips of 550 with a stop loss of 510 on a weekly closing basis and on the upside, we can see the level of 680-760 in the next 3-4 months.

Tata Motors: Target Rs 530-600 in the next 6-8 months
On the daily chart, we can see the stock moved in the consolidation phase from July 2021 to Sept 2021 in the range of Rs 268-315 odd levels.

Once the range was taken out on the higher side, the price gave a sharp upside rally to make a 4-years high of Rs 536 odd level. From the highs of Rs 536, the price witnessed some selloff as it retraced almost 90 per cent to make a low of Rs 366 level.

In the last 3 months, the price has formed an Inverted Head and Shoulder Pattern with the neckline forming at Rs 462 odd levels. Once this level is taken out, we can see a sharp upside move to Rs 530-600 odd levels.

RSI Oscillator shows positive divergence on chart and increase in volume indicates further upside from here. One can buy at the current price and more at dips of Rs 400 for an upside level of Rs 530-600 in the next 6-8 months.

Hence, we recommend buying at this level and more at dips of Rs 400 with a stop loss of Rs 360 on a weekly closing basis and on the upside, we can see the level of Rs 530-600 in the next 3-4 months.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)