Technical Breakout Stocks: REC, CESC and Power Grid hit fresh highs; here’s how to trade power stocks on Friday

Rally was seen in power and utilities indices, which were up over 1% each, followed by gains in auto and metal stocks. Some profit taking was seen in banks, telecom and consumer durables.

The Indian market recouped losses and closed in the green on Thursday. The S&P BSE Sensex rose over 100 points while the Nifty50 closed above 22,600 levels.

Sectorally, the rally was seen in power and utilities indices, which were up over 1% each, followed by gains in auto and metal stocks. Some profit taking was seen in banks, telecom and consumer durables.

Stocks that were in focus include names like REC Ltd, which was up over 9% to hit a fresh record high, followed by CESC which closed with gains of over 3% and Power Grid was up nearly 4% to hit a fresh high on Thursday.

We have collated a list of three stocks that either hit a fresh 52-week high, or an all-time high or saw a volume or a price breakout.

We spoke to an analyst on how one should look at these stocks the next trading day entirely from an educational point of view:

Here’s what analyst Kush Ghodasara (CMT, SEBI RA : INH000002137) has to say:

REC Ltd: Avoid Fresh Positions

The stock has been trading in a downside channel since the start of 2024 but in the last two trading sessions, we saw a breakout in the north direction with heavy volumes, which validates the move.

Indicators that were moving south have also turned north making the momentum strong. Now, the 10-15-day average will act as support at 461, which is coincidentally trend line support.

Therefore, fresh positions can be avoided as risk-to-reward ratio is not favourable while existing long positions can have stop loss at 461.

CESC Ltd: Buy | Target Rs 172

The stock has been trading in a rectangular consolidation zone in the range of 110-152 while volumes were moderate during the phase.

But on Thursday, we managed to nudge outside the pattern with some volumes. The RSI indicator has just entered the overbought zone, which generally suggests some fast and furious rally in a short time.

The short-term moving averages are placed at 144, acting as a strong support that could act as stop loss and fresh target for short term is placed at 172.

Power Grid: Buy for long-term investment

The stock has been one of the best performers for long-term investors in the near past. It has been taking strong support at a 10-week average since the low in February 2023.

Indicators too are positive on a weekly time frame, which suggests that the move is going to continue on a positional basis.

The stock can be bought for short-term investment and not trading with a stop loss at 280, which is 10-weeks average while the target can be with a trailing stop loss at the average.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)

Source: Stocks-Markets-Economic Times