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Mumbai: As Diwali arrives, bringing with it the light of prosperity and joy, investors have a unique opportunity to harness this auspicious occasion for a fresh financial beginning. The Diwali Muhurat Trading session symbolises more than tradition; it serves as a meaningful gateway into Samvat 2081, a promising year in which strategic investments can lay the foundation for steady growth. This year, the equity market has already rewarded investors with impressive returns. The Nifty index, for example, surged to a peak of 26,277 before entering a corrective phase over the past month, driven largely by Foreign Institutional Investor (FII) outflows amounting to over Rs 90,000 crores in October alone.
This recent correction was expected, as Nifty’s peak aligned with key retracement resistance levels and the momentum indicators on both weekly and monthly charts reached overbought conditions. While this pullback represents a price-wise correction, analysts note that it’s part of a healthy, ongoing uptrend that could also see a time-wise correction in the near term.
With Diwali Muhurat Trading marking the start of a new Samvat year, investors are encouraged to make selective, strategic investments. Based on expert insights, we’ve highlighted five technically strong stocks to consider during this auspicious session: Reliance Industries, SBI, Bharat Dynamics Limited (BDL), Olectra Greentech, and Mphasis. Let’s take a closer look at these recommendations, each backed by sound technical analysis and positioned to potentially yield favourable returns.
Samvat 2081 Stock Picks for Muhurat Trading
1. Reliance Industries
• Buy Range: Rs 2710-Rs 2740
• Support Levels: Rs 2530/Rs 2450
• Potential Targets: Rs 3030/Rs 3250
Reliance Industries, a leader in multiple sectors, is currently trading close to its weekly 89-EMA support level. The stock has retraced 50% from its prior uptrend, with the daily Relative Strength Index (RSI) signalling oversold conditions, suggesting a potential rebound in the near term. However, it’s important to note that Reliance Industries will undergo corporate action on October 28, 2024, with a 1:1 bonus issue; as such, price levels will adjust accordingly. This stock remains a strong candidate for accumulation on dips, and technical indicators suggest further growth potential.
2. State Bank of India (SBI)
• Buy Range: Rs 800-Rs 820
• Support Levels: Rs 765/Rs 730
• Potential Targets: Rs 915/Rs 970
SBI, India’s largest public sector bank, has recently formed a strong support base at its 200-day EMA. Furthermore, the stock has broken past a trendline resistance level, signalling renewed momentum in its price movement. The RSI oscillator on SBI points towards an upward trend, making this stock a favourable choice for Diwali Muhurat Trading. SBI’s technical setup supports a buy-on-dip strategy, and its fundamentals reinforce its position as a valuable stock for both long-term and short-term investoRs
3. Bharat Dynamics Limited (BDL)
• Buy Range: Rs 1000-Rs 1030
• Support Levels: Rs 950/Rs 870
• Potential Targets: Rs 1190/Rs 1300
Bharat Dynamics Limited, a key player in India’s defence sector, stands out with its solid technical structure. Previous breakout levels have transformed into strong support areas, and the stock is currently trading around the weekly 50 EMA. A notable factor here is the low trading volume during recent corrections, indicating limited selling pressure and a stable price base. This setup suggests that BDL may be well-positioned for an upward move, making it a compelling option for investors looking for strategic accumulation during the Muhurat Trading session.
4. Olectra Greentech Ltd
• Buy Range: Rs 1600-Rs 1620
• Support Levels: Rs 1500/Rs 1380
• Potential Targets: Rs 1860/Rs 2040
Olectra Greentech, known for its innovations in the electric vehicle and green technology space, has experienced a slight correction, with minimal trading volume indicating reduced selling pressure. Currently trading around its weekly 50 EMA support level, Olectra Greentech’s RSI on weekly charts has shown a positive crossover, pointing to favourable momentum ahead. As an environmentally focused company, Olectra Greentech aligns with long-term sustainability trends, and its technical indicators support potential growth, making it a promising pick this festive season.
5. Mphasis
• Buy Range: Rs 3080-Rs 3100
• Support Levels: Rs 2840/Rs 2648
• Potential Targets: Rs 3560/Rs 3880
Mphasis, a prominent player in the IT services sector, is forming a “Higher Top Higher Bottom” pattern, which is considered a strong bullish indicator. The 20 EMA on its weekly chart acts as a support level, while the RSI oscillator points towards positive momentum. This technical strength positions Mphasis as an ideal candidate for Diwali Muhurat Trading, especially as the IT sector continues to benefit from global digital transformation trends. With stable technical indicators and positive momentum, Mphasis presents an attractive entry point for investors seeking long-term gains.
Strategic Tips for Muhurat Trading
• Accumulate on Dips: For each of these selected stocks, adding on dips toward Support 1 levels can help investors strengthen their positions as the market stabilises, allowing for more significant gains as prices rebound.
• Set Stop Losses: To mitigate risks, it’s advisable to place stop-loss orders just below Support 2 levels, particularly during volatile sessions. This ensures that unexpected downturns do not impact overall portfolio health.
• Moderate Expectations: Given the anticipated consolidation phase in the market, traders and investors should set realistic expectations for moderate gains in the coming year. High-quality stocks that align with the market’s long-term upward trend are ideal for portfolio resilience.
Conclusion
The Diwali Muhurat Trading session in Samvat 2081 is more than a symbolic tradition; it represents a valuable opportunity for investors to set the tone for a financially successful year. By focusing on technically resilient stocks like Reliance Industries, SBI, Bharat Dynamics Limited, Olectra Greentech, and Mphasis, investors can create a balanced and growth-oriented portfolio. Each of these stocks is backed by strong technical indicators providing a stable foundation for those seeking both short-term gains and long-term growth.
As Samvat 2081 unfolds, the equity market is expected to undergo a period of consolidation, requiring investors to exercise patience and make calculated investment choices. This Muhurat Trading session is the perfect time to embrace opportunities for strategic accumulation, allowing for portfolio expansion and stability in the face of market corrections. Diwali, the festival of lights, is about new beginnings, and with expert recommendations, you can illuminate your financial future with prosperity and growth.
(With inputs from agency)
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