Nifty Eyes 24,600 Retest: Two High-Conviction Stock Picks to Watch

The Indian equity markets are showing signs of a significant breakout after a month-long period of consolidation. With momentum gathering strength, market analysts suggest that the current trend favors a "buy on dips" strategy as the Nifty index targets crucial psychological and technical milestones.

Nifty Momentum: Targeting the April Swing High

The recent shift in market sentiment suggests that the Nifty is entering a decisive positive phase. According to Rajesh Bhosale, Equity Technical Analyst at Angel One, the index is successfully sustaining above key support levels, which has shifted the short-term bias to the upside.

Bhosale anticipates that the Nifty is on a trajectory to retest its April swing high of 24,600. For investors looking for entry points, the 23,750–23,800 zone has emerged as a critical support level, providing a strategic window for dip-buying. This bullish outlook is further supported by a positive external backdrop, including strong performances in Asian markets and upward movement in US equity futures.

High-Conviction Pick 1: Trent Ltd

One of the standout performers in the recent breakout is Trent Ltd. After spending approximately a month in a range-bound movement—trapped between its 50-day and 200-day Exponential Moving Averages (EMA)—the stock has finally triggered a momentum signal.

On Monday's session, Trent confirmed a decisive price range breakout while simultaneously crossing above its 200-day Daily Moving Average (DMA). This technical alignment suggests that the stock is ready for a fresh leg of growth.

High-Conviction Pick 2: Phoenix Mills

The second recommendation focuses on Phoenix Mills, which is displaying a classic technical reversal pattern. The stock has formed a "textbook double bottom" formation on its 200-day DMA.

A double bottom is widely recognized by technical analysts as a strong signal that a downward trend has ended and a reversal is underway. With the breakout confirmed during Monday's trading session, Phoenix Mills is positioned for strong near-term momentum.

Strategic Approach for Investors

As the market moves out of its consolidation phase, the consensus among experts is that the momentum is real but still in its early stages. Rather than chasing rapid price surges, the recommended strategy is to maintain a stock-specific approach. Investors are advised to utilize defined stop losses to manage risk while capitalizing on specific breakouts. This disciplined method allows for participation in the upside while protecting capital against sudden volatility.

Key Takeaways