Stocks to buy: Two stock recommendations from MarketSmith India for 4 December

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Subscribe to enjoy similar stories. Indian stock market’s benchmark index Nifty50 extended its gaining momentum for three consecutive sessions. The index gained around 181 points or 0.75% and formed a bullish candle with a higher-high and higher-low price structure.

It started the session on a positive note at 24,367.50 and made an intraday low at 24,280. However, strong buying in PSU banks, energy, metal, and BFSI stocks lifted the index to 24,481. FMCG stocks underperformed after the group of ministers (GoM) on GST rate rationalization recommended raising the tax on aerated beverages, cigarettes, tobacco, and related 'sin' products to 35%.

The advance-decline ratio was in favour of the bulls (3:1). Technically, the index was facing strong resistance around 24,400 for the past six trading sessions. On Tuesday, it broke out above this level and surpassed the trendline, connecting the high of 6 November 2024 to that of 28 November 2024.

The momentum indicator, the 14-period relative strength index (RSI), is trending slightly upward and currently placed at 56. Another technical indicator, moving average convergence/divergence (MACD), is trending with a positive crossover but is still below the central line. Moving forward, the 50- and 100-DMA, currently placed around 24,625 and 24,700, respectively, are the key levels to watch in the coming days.

The ongoing trend indicates that the bullish trend is likely to continue in today's trading session. Sustainable trading above 24,400 may lead the index toward 24,700–24,800 in the coming days. However, a failure to hold above 24,400 may result in volatility in the sideways zone.