F&O Stock Strategy: How to trade Tata Chemicals, Hero Moto, Concor today

The last week of 2023 ended with a strong bullish candle and the trend is expected to continue as investors enter the new year with fresh enthusiasm. In light of this, three stocks have formed a strong setup on the charts for further rally, giving a good risk-reward ratio.

Here’s the trading strategy from Sheersham Gupta, Director and Senior Technical Analyst at Rupeezy:

Tata Chemicals – Inverted Head and Shoulder Breakout
Tata Chemicals had been consolidating in the range of 900 and 1150 for the past two years. But last week, the stock saw fresh momentum to cross its 50-day Moving Average (DMA).

1100 was a short-term resistance for the stock which was broken with good volumes. Daily RSI is at 73 indicating strength in the stock.

On the derivative front, huge put writing was seen even on strike prices above the At-The-Money (ATM), and buying was seen on the call side depicting the bullish sentiment in the stock.

Thus, Tata Chemicals can be bought for a target of 1195 for the short term. The stop loss for the stock will be 1078 on a closing basis.

Hero Motocorp- All-Time High Breakout
Hero Motocorp touched a high of 4090 in 2017 and since then has been trading below this price level. Last week, the stock broke this level with good volumes and is now consolidating to retest the breakout level.

The Daily RSI for the stock is 71, however, the weekly RSI is 81. So, consolidation for the short term can be expected.

On the derivative front, call writing was seen indicating the stock may pause for a while before continuing its upward march.

Hence, it is suggested to buy Hero Motocorp for a target price of 4480 and the stop loss will be 3975 on a closing basis.

Concor- Rounding Bottom Pattern Breakout
830 was the all-time high for Concor which was broken last month decisively with good volumes. Now the stock is consolidating after the breakout of this level indicating breakout confirmation.

The weekly RSI is 73 and the daily RSI is 65 indicating a good upside potential for the stock.

On the derivative front, huge writing was seen on the put side and buying was seen on the call side indicating the conviction of the traders on the upside.

Technical analysis and option chain data suggest Concor is a good bet for buying for a target of 940. Stop loss can be placed at 818 on a closing basis.

(You can now subscribe to our ETMarkets WhatsApp channel)

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