In a recent analysis, Jigar S. Patel, a renowned market expert from Anand Rathi, has highlighted three stocks that present promising buying opportunities for investors. The stocks in focus—CG Power, DMart, and Bharat Dynamics Limited (BDL)—show potential based on their recent price actions, technical indicators, and market conditions.
1. CG Power
CG Power has recently entered a corrective phase, witnessing a significant pullback of 175 points, translating to approximately a 20% decline from its recent peak. This correction has brought the stock down to a crucial support level within a historical demand zone, where buyers have previously shown strong interest. Patel points out that a bullish divergence is evident on the hourly chart, indicating a potential shift in momentum as the selling pressure appears to be weakening. Moreover, the stock has broken above a prevailing bearish trendline, reinforcing the likelihood of a reversal.
Given this confluence of bullish signals, Patel recommends going long in the range of ₹715-725, targeting an upside of ₹790. To mitigate risk, he advises placing a stop-loss at ₹685 on a daily closing basis, ensuring protection against any adverse movement if the support zone fails to hold.
2. DMart
D-Mart has faced considerable selling pressure over the past five weeks, with the stock price declining from a high of ₹5,484 to around ₹4,000. After hitting an intraday low of ₹3,876 on October 31, 2024, the stock has recently stabilized near this level. This ₹4,000 zone coincides with a long-term bullish trendline support visible on the weekly chart, adding technical significance to the price point as a potential area for stabilization.
On the daily chart, the Relative Strength Index (RSI) is forming higher lows, indicating a possible reduction in selling pressure and exhaustion among sellers around this support zone. Additionally, a hidden bullish divergence has emerged on the hourly chart, suggesting that the downside momentum may be weakening. Given these supportive technical indicators, Patel recommends initiating a long position in the range of ₹3,990-4,010, with a target of ₹4,400. To manage risk effectively, a stop-loss should be set at ₹3,800 on a daily closing basis.
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3. Bharat Dynamics Limited (BDL)
After peaking at approximately ₹1,794 in July 2024, Bharat Dynamics Limited (BDL) has been in a corrective phase, consistently forming lower highs and lower lows. This downtrend has resulted in a substantial correction, with the stock experiencing a decline of around ₹800 (approximately 44%) from its high. However, BDL is now showing signs of stabilization as it approaches a previous demand zone that has historically attracted buyers.
Adding to this optimistic outlook, a bullish divergence is forming on the daily chart, suggesting that bearish momentum may be waning and a reversal could be on the horizon. Based on these technical indicators, Patel recommends initiating a long position in the range of ₹1,085-1,120, with a target set at ₹1,220, indicating considerable upside potential. To protect against further downside, a stop-loss should be placed at ₹1,020 on a daily closing basis.
Jigar S. Patel’s recommendations highlight significant investment opportunities in CG Power, DMart, and BDL, each showcasing strong technical indicators that suggest potential reversals. Investors are advised to consider these insights while also exercising due diligence and risk management strategies. The recommendations provide a strategic entry point for those looking to capitalize on current market conditions, as each stock has demonstrated resilience and signs of recovery. As always, investors should assess their financial situation and consult with their financial advisors before making investment decisions.
