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Stocks to Buy: Analyst bullish on this stock, asks to buy for target of Rs 525
Sacchitanand Uttekar, who is DVP-Head-Technicals & Derivatives at Tradebulls Securities an upside of another 35 points from the current levels. He sees a target price at Rs 520-525 over the short term period. “For a stock like SBI, it is huge,” the DVP said. He puts the stop loss at Rs 474
Investors willing to invest in stocks that could bear high returns over a short to medium term can look to buy stocks from the banking and financial sector, technical analyst Sacchitanand Uttekar said. One stock that he is bullish on is the State Bank of India (SBI) shares. After attaining highs of Rs 542.30 on the NSE on 3 November 2021, the stock has witnessed correction and this phase is behind now, he opined.
SBI: Buy| LTP: Rs 488| Target: Rs 525| Stop Loss: Rs 474| Upside 7-8%
The direction in SBI shares is positive and investors must capitalise on this opportunity to make gains, he added.
The SBI shares were trading at Rs 488.50 on the NSE around 1:40 pm, up almost 2.5 per cent or Rs 11 from the Monday closing price.
Uttekar, who is DVP-Head-Technicals & Derivatives at Tradebulls Securities an upside of another 35 points from the current levels. He sees a target price at Rs 520-525 over the short term period. “For a stock like SBI, it is huge,” the DVP said. He puts the stop loss at Rs 474.
The structure looks positive and the stock is unlikely to breach Rs 460, he further said.
Since hitting its 52-week highs, the stock has managed to move both ways. On 30th November it hit a low of Rs 459.10 on a closing price basis and since then, it has been on the upside with small corrections on a couple of occasions.
He said that the stock corrected in tandem with the market movement like its other banking peers. A sharp recovery was seen in SBI shares from the swing bottom it made on 29 November (Rs 454.30).
The RSI (Relative Strength Index) was placed close to 35. On this Monday, the RSI rebounded from levels of 35-36 to end around 38.5 despite a negative price action and fears of breakdown.
On the weekly charts, the stock witnessed a spinning top action near its 20-day exponential moving average. Over the last 7-months this moving average has not been breached on closing price basis.
The spinning top movement is indicative of uncertainty and direction of the stock movement is confirmed only when the low or high of the spinning top is breached. In SBI’s case the high has been breached, Uttekar said. This suggests that an upside is open for SBI from the existing levels.
Another important indicator is if the stock manages to break away from the 5-day, 20-day moving averages despite a strong downside trend in a short period, that is a sign of strength.
He said that the stock looks strong even beyond the short term target price.
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