Stocks to buy—10 February: MarketSmith India recommends two stocks for today

Despite the widely expected rate cut to 6.25% and the central bank’s ‘neutral’ stance, investor sentiment remained subdued. The RBI also set its FY26 GDP growth target at 6.7% and projected FY25 inflation at 4.8%.

Nifty 50 had opened flat at 23,249.50 on Friday and fluctuated between gains and losses, trading within a range of 23,440–23,700. It formed a third consecutive bearish candle on the daily chart, indicating a lower high, lower low price structure. 

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Sectorally, only Metal, Auto, and Pharma posted gains, while all other major indices closed flat to negative. The market breadth favored decliners, with the advance-decline ratio settling at 1:2.

Despite Friday’s decline, Nifty 50 closed positive for the second consecutive week, forming a bullish candle with a higher high, higher low structure on the weekly chart. However, the index is facing strong resistance around its 50-day moving average (DMA) and a downward sloping trendline connecting the highs of September 2024 and December 2024.

The 14-day Relative Strength Index (RSI) remains sideways around 52. The MACD (Moving Average Convergence Divergence) indicator has turned positive but remains below its central line.

Going forward, Nifty 50’s ability to break above these key resistance levels will determine its next move.

According to O’Neil’s methodology of market direction, Nifty staged a follow-through day on 4 February, as it advanced more than 1.5% on volume higher than the session on 3 February. Hence, we have upgraded the market status to a Confirmed Uptrend. We may downgrade the status to an Uptrend Under Pressure if the distribution day count increases and Nifty breaches its key support level.

The index has been facing strong resistance around its 50-DMA, which is currently placed at 23,750- 23,800. It closed in the red for the third consecutive day on Friday. 

The 50-DMA is a key level to watch out for and a sustainable trade above it may see the index move towards 200-DMA i.e. 24,000-24,200 level. However, a failure to trade above 50-DMA may witness a lacklustre trading session. Immediate support is placed at around 23,400 followed by 23,200.

How Nifty Bank performed

The Nifty Bank index remained volatile on Friday, closing in negative territory with a 0.44% decline. The index formed a bearish candle on the daily chart and ended just below its 200-day exponential moving average (EMA). It had opened at 50,484.45, fluctuated between an intraday high of 50,641.75 and a low of 49,871.15, before settling at 50,158.85.

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Despite Friday’s decline, Nifty Bank gained 1.32% on the weekly chart, marking its second consecutive bullish candle and signaling resilience in the broader trend.

Technical indicators:

RSI (14-day): Gradually improving, currently at 54 on the daily chart.

MACD: Shows a positive crossover, trending near its central line.

Going forward, Nifty Bank’s ability to sustain above the 200-EMA and build on weekly gains will be key for further strength.

According to O’Neil’s market direction methodology, we upgraded the market status to a Confirm Uptrend on 4 February as Nifty Bank crossed its recent rally high, placed at 49,650.60. Overall, the market breadth is improving. Leading stocks in this space are progressing well. However, we may downgrade the status to an Uptrend Under Pressure if the distribution day count increases and the index breaches its key support level.

The index is facing resistance at 50,600-50,800. Once this hurdle is surpassed, the index might surpass 51,000 and target 52,000. Immediate support is placed around 49,600 followed by 49,000.

Stocks recommended by MarketSmith India:

● Southern Petrochemical Industries Corp: Current market price ₹ 82.03 | Buy range ₹ 79.50 – 83 | Profit goal ₹ 99 | Stop loss ₹ 73.80 | Timeframe 2-3 Months

● Bharti Airtel Ltd: Current market price ₹ 1,678 | Buy range ₹ 1,650- 1,685 | Profit goal ₹1,940 | Stop loss ₹ 1,550 | Timeframe 2-3 Months

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.