5 stocks to buy and sell as crude oil prices drop to $70 a barrel
Source: Business Standard
Crude Oil prices have declined nearly 13 per cent so far in the month of September amid demand concerns from the two biggest world economies – the US and China. In the process, the Crude Oil prices are now seen trading to near about 3-year lows.
The Brent Crude Oil futures tanked to a low of $68.67 per barrel this week, down below the $70-mark for the first time since December 2021. Brent Crude Oil has recouped some of its losses, and today was seen quoting around $71 per barrel.
Technically, Brent Crude Oil futures were seen testing support around its 100-MMA (Monthly Moving Average) at $69.40 levels. Chart suggests that the near-term bias for Crude Oil is likely to remain tepid as long as oil prices trail below $73 levels.
Similarly, the US WTI Crude Oil futures were seen trading around $67.67 per cent on Thursday.
In the Indian stock market context, lower crude oil prices augur well for select sectors such as oil marketing companies, aviation and paints; whereas, oil producers may feel the pinch.
Given this background here are 5 stocks ideas related to oil prices, which could see a sharp move in the coming sessions:
Asian Paints
Current Price: Rs 3,371
Upside Potential: 16%
Support: Rs 3,292; Rs 3,150
Resistance: Rs 3,450; Rs 3,500; Rs 3,570
Asian Paints stock has given a breakout on the weekly scale; the near-term bias is likely to remain upbeat as long as the stock holds above Rs 3,292. On the upside, the stock is seen trading very close to its existing higher-end of the trading range at Rs 3,450.
The stock has broadly traded in the Rs 2,650 – Rs 3,500 range since April 2021. With key momentum oscillators, both on the weekly and monthly scale in favour of the bulls the stock may attempt to break on the upside. The stock will need to clear hurdles around Rs 3,450, Rs 3,500 and Rs 3,570 for opening the doors for a sustained rally towards Rs 3,912 levels.
ONGC
Current Price: Rs 288
Downside Risk: 11.8%
Support: Rs 274; Rs 268
Resistance: Rs 294; Rs 313; Rs 317
ONGC stock has plunged 14 per cent thus far in September. Amidst this, the ONGC has dipped below its 20-, 50- and 100-DMAs. The stock seems on course to test support around its 200-DMA at Rs 265; below which test of Rs 254 – its 50-WMA (Weekly Moving Average) also seems possible. Interim support for the stock can be expected around Rs 274 and Rs 268.
Oil India
Current Price: Rs 578
Downside Risk: 19.90%
Support: Rs 535; Rs 528
Resistance: Rs 616; Rs 657
Oil India has tumbled over 22 per cent thus far this month. The stock is now trading below its 20- and 50-DMA for the first time in 3 months; further, the stock seems on course to test the 100-DMA support at Rs 528 levels.
Prior to this month’s correction, Oil India stock had zoomed 389 per cent from levels of Rs 157 in June 2023 to a high of Rs 768 in August 2024 – just 14 months. Given the current price correction, 38.2 per cent retracement of the earlier rally, suggests support for the stock at Rs 535 levels; below which the next logical downside target shall be Rs 463.
Indian Oil (IOC)
Current Price: Rs 172
Upside Potential: 10.5%
Support: Rs 166
Resistance: Rs 174; Rs 181
The weekly chart of Indian Oil Corporation (IOC) suggests that the stock has consistently found support around its 20-WMA (Weekly Moving Average) in the last three months. The 20-WMA support now stands at Rs 166 and is likely to act as key bullish pivot for the stock, as it also coincides with the 100-DMA.
MRF
Current Price: Rs 1,36,150
Upside Potential: 15.9%
Support: Rs 1,34,000; Rs 1,32,550
Resistance: Rs 1,40,700; Rs 1,42,500; Rs 1,46,000
MRF stock is seen attempting a breakout above its 20-DMA, which stands at Rs 1,36,135 levels. In the last few days, the stock has been trading in a congestion zone of Rs 1,34,00 – Rs 1,37,000. Select key momentum oscillators have shown positive crossover on the daily chart; hence the stock may attempt to edge higher in the coming sessions.
As such, the stock can potentially rally all the way to a new high around Rs 1,57,750 levels, suggests the long-term chart. Interim resistance for the stock can be expected around Rs 1,40,700, Rs 1,42,500 and Rs 1,46,000 levels.
First Published: Sep 12 2024 | 12:19 PM IST
