Canara Bank, BHEL top Muhurat trading day stock picks: Sujit Deodhar

“Nifty seems to be catching up with the momentum and a break above 17,620 levels will have the highest probability of Nifty approaching the 17,900-18,000 levels in the coming week or so,” says Sujit Deodhar, Head - Technical Analyst, Wellworth Share & Stock Broking.

In an interview with ETMarkets, Deodhar, said: “Trader should buy the quantity which he/she is comfortable holding on the Muhurat day and avoid trading on leverage.” Edited excerpts:

What a week for Indian markets ahead of Diwali. Benchmark indices rose by about 2%. What led to the price action?
The index has really done well in the past week heading towards 17,500 levels, post a sharp fall from 18,100-16,750 levels in the last 15 days of September. One index which seems to be the star performer is the NIFTY PSU Bank index which saw a 9% appreciation.

Where do you see Nifty in the coming truncated week? Do you see 17,800 on Muhurat Trading Day?
Slowly, the index seems to be catching up with the momentum and a break above 17,620 levels will have the highest probability of Nifty approaching the 17,900-18,000 levels in the coming week or so.

If that happens before Muhurat, then definitely 17,800 is in offing.

In terms of sectors, banks and PSU stocks rose more than 3%. What led to the price action?
PSU Bank index seems to be the leader among the pack & the rally was led mainly by Canbank & Indian Bank as they posted more than 15% gains.

The first leg of the up move in the Nifty PSU bank index move was led by SBI & Bank Baroda post-Covid (March 2020) & the second leg is witnessing the performance of smaller banks.

Overall, the index looks bullish from a medium to long-term perspective and the price projections fix a target closer to 5,000 levels from the current levels of 3,214 in the next 4-6 quarters.

What are your top Muhurat Trading Day picks for the short term?
I would like to go with the theme & the outperformers for the Muhurat Trading which is the PSU stocks.

Canara Bank: Buy| Range 240-258| Target Rs 300| Stop Loss Rs 225
Canara Bank is a buy at current levels of 258 and on declines to levels of 240 for an upside target closer to 300 levels with a stop loss placed below 225 levels on a daily close basis.

BHEL: Buy| Target Rs 82-100| Stop Loss Rs 54
BHEL is the next pick which has recently broken out of its resistance with strong volumes at 65 levels and is likely to head towards levels of 82 followed by 100 with a stop loss to be placed below 54 on a daily close basis.

What is your take on the rupee? Do you see further weakness in the coming week?
The series of higher tops & higher bottoms in the USD/INR seems to be continuing on the daily charts. The resistance for the pair is placed at 84.80 levels.

There are back-to-back 10 green candles on the monthly charts of USD/INR (Jan-Oct 2022) so one should not be highly bearish on the rupee from current levels of 83 as the RSI (relative strength index) value is 79.20 & as per history every top of USD/INR has taken place when the Oscillator value is closer to 79.

One trading advice you would want to give to traders on Muhurat Trading for Samvat 2079.
Muhurat trading is auspicious for every trader as well as for investors. Many participants trade on this special occasion of Samvat.

I would personally suggest not taking trades for just that particular day and one has to have a longer-term horizon as well as the right money management in place.

Traders should buy the quantity which he/she is comfortable holding and avoid trading on leverage.

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