Big Movers on D-St: What should investors do with Navin Fluorine, Hindustan Aeronautics and Lemon Tree?

Indian market closed in the green on Monday tracking positive global cues. The S&P BSE Sensex rose more than 300 points while Nifty50 reclaimed 17900 levels.

Sectorally, buying was seen in realty, consumer durables, IT, utilities, and power stocks.

Stocks that were in focus included names like Navin Fluorine which closed with gains of more than 6 per cent, Hindustan Aeronautics closed with gains of over 7 per cent, and Lemon Tree hit a fresh 52-week high closed with gains of over 2 per cent on Monday.

Here's what Jatin Gohil, Technical and Derivative Research Analyst at Reliance Securities recommends investors should do with these stocks when the market resumes trading today:

Navin Fluorine International Limited - Hold
The stock oscillated downwards after witnessing a breakout from the bullish flag pattern. Later, the stock bounced after forming a base around its prior point of polarity (placed at around Rs 4,170) and recorded a new high of Rs 4,680 subsequently.

The stock has the potential to move towards its breakout point which is placed at around Rs 4,980. The key technical indicators are positively poised on long-term and medium-term timeframe charts, while short-term indicators are stuck around the overbought zone.

The risk-to-reward ratio is not favourable for a fresh long position while existing ones can be trailed at around Rs 4,450 for a probable rise.

Hindustan Aeronautics Limited - Buy
The stock is in a strong up-trend as it has witnessed a breakout after an upward consolidation and recorded a new lifetime high of Rs 2,638.

The rise in volume and an increase in future open interest (OI) signals that major market participants are in favour of the bulls.

Since, 18th Jul’22, the stock remained above its 13-day EMA and it has explored uncharted territory. The key technical indicators are positively poised on major time frame charts.

The stock has the potential to move towards Rs 3,000 in the short term. Its short-term indicators tested the overbought zone and may witness a negative cross-over.

This could drag the stock towards its extended upper band of the consolidation, which is placed at around Rs 2,500.

Hence, a fresh long position can be initiated at the current juncture and on dips towards Rs 2,500 for a probable up-move.

On the lower side, the stock will continue to find support around its 13-day EMA), which is currently placed at Rs 2,381. In the past, the stock reversed after testing that moving averages and witnessed a strong up-move subsequently.

Lemon Tree Hotels: Buy
Continuing its prior daily up-move, the stock rose to a fresh 3-year high of Rs 82.65 on 12th Sep’22. The stock is positively poised above its key moving averages (20-day, 50-day EMAs, and 100-day, 200-day SMAs).

The key technical indicators are in favour of the bulls on major time frame charts. This could lead the stock towards Rs 90 initially and Rs100 subsequently.

Due to the consecutive rise, its short-term indicators tested the overbought zone and may witness a bearish cross-over. This could drag the stock towards its 20-day and 50-day EMAs (placed at Rs 73 and Rs 70, respectively).

In the past, the stock reversed after testing its short-term moving averages and resumed the upmove subsequently.

Hence, a fresh long position can be initiated at the current juncture and on dips towards Rs 73 for the desired action. On the lower side, the stock will continue to find support around its long-term moving average (100-day SMA), which is currently placed at Rs 66. Since, 3rd Mar’22, the stock remained above that long-term moving average.

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