Top stocks to buy this week: Downside momentum on Nifty may be gaining strength; check stock recommendations with 3-month horizon

Stock market recommendations: According to Sudeep Shah, Head - Technical Research and Derivatives, SBI Securities, EID Parry, and Prestige are the top stock picks for this week. Here’s his view on Nifty, Bank Nifty and the top stock picks with a 3-month horizon:Nifty View:The benchmark Nifty index spent the first four trading sessions of the last week trapped in a tight 200-point range, reflecting the indecision among market participants.

But on Friday, the calm broke.

The index opened with a sharp gap down, slipped below its consolidation zone, and faced renewed selling pressure, signalling that sentiment is beginning to tilt in favour of the bears.What’s more alarming is that the Nifty has now slipped below its crucial 20-day EMA, which has also begun to slope downward — a classic sign of emerging weakness. The momentum indicators aren’t painting a comforting picture either.

The daily RSI has given a bearish crossover and continues to head south, while the MACD histogram has flipped into negative territory. Collectively, these signals suggest that downside momentum may be gaining strength.From a technical standpoint, immediate support now lies in the 24900–24850 zone, where the 50-day EMA is placed. A break below 24850 could push the index toward the next key support at 24550. On the flip side, a move above the 25300–25350 zone is required for bulls to regain control in the short term.

Amid this technical caution, macro and earnings uncertainties are only adding to investor anxiety. With tariff uncertainty rising globally and Q1 earnings just getting started—kicked off by TCS on Thursday—markets are entering a critical phase. Investors are now watching for signs of margin pressures, global demand outlooks, and forward guidance from corporates. In this tug-of-war between technical breakdowns and earnings expectations, a cautious and stock-specific approach may be the best strategy for now.Bank Nifty ViewLast week, the banking benchmark index Bank Nifty moved within a tight band of just 756 points, marking its narrowest weekly range since August 2024. This lack of movement reflects heightened indecision among market participants and a clear absence of strong directional cues from the banking space. On the weekly chart, the index has formed a small-bodied bearish candle with a long upper shadow, signalling that selling pressure is emerging at higher levels.

This candlestick structure typically suggests profit-booking or cautious sentiment whenever the index tries to move higher.Currently, Bank Nifty is hovering around its 20-day EMA level, reinforcing the view that the trend is at a crucial inflection point. The momentum indicators are hinting at a lack of conviction. The daily RSI remains in a sideways zone, as defined by RSI range-shift principles, further underscoring the ongoing consolidation. Going ahead, the zone of 56200-56300 will act as immediate support for the index. While on the upside, the zone of 57100-57200 will act as a crucial hurdle for the index. A decisive breakout in either direction will lead to the trending move in the index.Stock Recommendations:EID Parry

The stock has delivered a decisive breakout from its consolidation phase on the daily chart, signalling a fresh leg of uptrend. What makes this breakout significant is the accompanying surge in volume, lending strong conviction to the move.

Notably, the stock has been consistently outperforming the frontline indices over the past few trading sessions, highlighting growing investor interest and relative strength.

As the stock is trading at all-time high, all the moving averages and momentum-based setups are showing strong bullish momentum. Hence, we recommend to accumulate the stock in the zone of 1155-1145 level with a stoploss of Rs 1100 level. On the upside, it is likely to test the level of 1280 in the short term. Prestige

The stock registered a swing high of 1761 on June 24, followed by a throwback phase that was accompanied by subdued volumes — a sign of healthy profit booking rather than trend reversal. Notably, the correction found support near the 34-day EMA. Post this pullback, the stock has resumed its upward journey, supported by a noticeable rise in volume — adding conviction to the ongoing rebound. Over the past few sessions, it has been outperforming the frontline indices, signalling renewed strength and relative leadership.

Momentum indicators are now turning increasingly positive. The daily RSI is comfortably placed in bullish territory, while other oscillators are also supporting the ongoing uptrend. The technical structure suggests that the stock may be gearing up for a fresh move higher in the short term.

Hence, we recommend to accumulate the stock in the zone of 1700-1690 level with a stoploss of Rs 1620 level. On the upside, it is likely to test the level of 1900 in the short term. (Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)