Trade Spotlight | What should investors do with Jindal Steel, Tata Communications, KEI Industries today?

The medium-term texture of Tata Communications is still weak but due to a short-term reversal formation, it can see a quick pullback rally

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The market snapped its three-day winning streak with the benchmarks closing lower on the last day of the financial year 2021-22 and the expiry day for March derivative contracts.

The Sensex shed more than 100 points to close at 58,568, and the Nifty50 fell 33 points to 17,465. The broader market, however,  performed better. The Nifty midcap index gained 0.3 percent and the smallcap seven-tenth of a percent.

Select IT and pharma stocks and Reliance Industries pulled the market down, whereas FMCG and some banking & financials provided good support to the market.

Stocks that were in action include Tata Communications, which was the biggest gainer in the futures & options segment, rising 6 percent to Rs 1,228.6.

Jindal Steel & Power hit a fresh 52-week high of Rs 544.40 and gained 2.5 percent to close at Rs 532.85, taking the month’s gains to 25 percent. KEI Industries jumped 5.5 percent to Rs 1,261, taking monthly gains to 28 percent.

Here’s what Shrikant Chouhan of Kotak Securities recommends investors should do with these stocks when the market resumes trading today:

Jindal Steel & Power

On daily and weekly charts, the stock is holding higher high and higher low series formation, which is broadly positive for Jindal Steel & Power.

However, on the short-term time-frame, momentum indicators indicate the stock is in the overbought zone and high chances of quick short-term price correction is not ruled out if it trades below Rs 509.

For the next few sessions, Rs 509 would be the trend decider level. If the stock sustains above it, it could expect continuation of uptrend up to Rs 575-588. On the flip side, dismissal of Rs 509 could possibly trigger quick short-term correction till Rs 490.

Tata Communications

The stock corrected over 15 percent this quarter. Post medium term correction, it has formed consolidation formation. For the last couple of weeks, the stock was consolidating within the range of Rs 1,150 to Rs 1,200.

On March 31, it cleared the resistance of Rs 1,200 and after a long time close above it, which is broadly positive.

The medium-term texture is still weak but due to short-term reversal formation, it could witness a quick pullback rally in the near future.

Rs 1,190 and Rs 1,170 would be the immediate support zone for the Tata Communication. Above it, the pullback rally will continue up to Rs 1,260-1,300.

On the flip side, a fresh round of selling is possible if it trades below Rs 1,170 and could even slip to Rs 1,125-1,100.

KEI Industries

In March, the stock rallied over 25 percent. Post Rs 1,100 range breakout, it intensified the momentum. The medium-term texture of the chart is positive and likely to continue.

On the short term time frame, the stock is in the overbought zone and profit-booking is not ruled out if it trades below Rs 1,200.

On the flip side, above Rs 1,200, uptrend formation is likely to continue to Rs 1,300-1,375. Due to temporary overbought situation, traders may take a cautious stance near Rs 1,350-Rs 1,375 resistance level.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.