Stock market recommendations for the week starting May 25, 2026: Sudeep Shah, Head of Technical Research and Derivatives at SBI Securities, has identified Varun Beverages Ltd and Elecon Engineering Company Ltd as top picks. He also provides his outlook on Nifty and Bank Nifty.
Varun Beverages Ltd
Varun Beverages has turned technically strong after a Stage-2 cup pattern breakout on the daily chart, supported by a sharp surge in volumes. The stock has rallied nearly 11% since taking support near its 20-day EMA on May 13, reflecting sustained buying interest at lower levels. The weekly chart has confirmed a breakout from a downward-sloping trendline, followed by a strong follow-through move. Momentum indicators remain supportive, with the RSI holding above 60 on both daily and weekly timeframes. The rising ADX on the weekly chart highlights strengthening trend momentum, indicating continued upside potential. Shah recommends accumulating the stock in the zone of 537-542 with a stop-loss of 523, targeting 578 in the short term.
Elecon Engineering Company Ltd
Elecon Engineering has taken support near its 200-day EMA and started moving higher with relatively higher volume. Momentum indicators support the bullish setup, with the RSI surging from 50 to 63 on the daily timeframe. The DI+ crossing above DI- in the ADX indicator points to strong buyer dominance, while rising green histogram bars on the weekly MACD reinforce the bullish bias. Shah recommends accumulating the stock in the zone of 530-535 with a stop-loss of 515, targeting 570 in the short term.
Nifty View
As expected, the benchmark index Nifty continued to trade within a narrow range of nearly 542 points during the week, ending close to 23,700 with a marginal gain of 0.27%. On the weekly chart, it formed a small-bodied candle with shadows on both sides, reflecting indecision among market participants. Over the past eight trading sessions, the index has oscillated within the 23,860-23,262 range, with each session witnessing either a gap-up or gap-down opening. This consolidation has led to a flattening of the 20-day and 50-day EMAs, while the daily RSI has been confined to 44-47. The ADX at 16.86 indicates an absence of trend strength. The broader market echoes a similar trend, with most sectors stuck in consolidation phases. Going ahead, the index is likely to continue its sideways trajectory until a breakout from the current range. On the upside, the 23,850-23,900 zone is expected to act as strong resistance, while the 23,400-23,350 zone provides immediate support.
Bank Nifty View
Bank Nifty has relatively outperformed frontline indices over the past week, forming a base near the 61.8% Fibonacci retracement level of its recent up move (49,955-57,456) and witnessing a mild pullback. Despite the retracement, the index continues to trade below key moving averages, indicating a cautious broader trend. The daily RSI suggests a sideways phase, and other momentum indicators point to a lack of clear directional bias. The 53,200-53,000 zone is likely to act as strong support, while the 20-day EMA zone of 54,350-54,500 serves as key resistance. A sustained move above 54,500 could trigger further upside toward the 50-day EMA at 55,270.
Disclaimer: The views and recommendations expressed by experts are their own and do not represent the views of Bharat Horizon.
