In the run-up to this year’s session, equity benchmarks have exhibited strong upward momentum. The Nifty has comfortably crossed the 25,700 mark, while the Bank Nifty scaled a new lifetime high of 57,830. According to analysts, this pre-festival rally reflects “growing investor confidence and a robust undertone across sectors.” The broader sentiment, they note, continues to be supported by institutional flows and improving global cues.
One of the sectors gaining attention ahead of Muhurat trading is the Auto sector. According to Hardik Matalia, Derivative Analyst at Choice Broking, the sector has shown a strong structural recovery on the charts.
He notes that the Auto index is currently forming a Rounding Bottom pattern on the weekly timeframe, “a classic indication of a major base formation and potential long-term trend reversal.”
After a period of healthy correction from previous highs, the sector has seen renewed buying interest near its demand zone, which analysts believe is driving it back towards earlier peaks. Matalia explains that this setup underlines sectoral strength and improving demand outlook, making Auto a preferred pick for the festive session.
Within the Auto space, Ashok Leyland (ASHOKLEY) has been highlighted as a stock to watch. Currently trading at Rs 134.51, the stock is showing a solid bullish structure on the weekly chart. As per Matalia, the chart displays “higher highs and higher lows,” supported by the formation of a Rounding Bottom and rising volumes — indicators that point to “a strong accumulation phase and growing investor conviction.”Also read: Gold, silver or Nifty this Diwali? 35 years of data reveals the clear winner
The stock is trading above all key moving averages — the 20, 50, 100, and 200-day exponential moving averages (EMAs) — which, according to the analyst, confirms “sustained upward momentum.” The immediate resistance is seen near Rs 140, with a potential upside move toward Rs 151 and Rs 158, should a breakout occur.
Supporting this bullish structure, the Relative Strength Index (RSI) is currently at 60.44, which Matalia says “further validates the ongoing strength, indicating that bulls remain in control.”
Trading strategy ahead of the Muhurat trading session
Based on technical indicators, Matalia recommends a tactical approach for those looking to participate in the Muhurat session. “Investors can consider initiating long positions around the current level of Rs 134.51, with dips toward Rs 131 serving as ideal accumulation zones.”
He adds that strong support exists at Rs 126, which should be used as a stop-loss reference.
According to him, “As long as the stock holds above this support, the broader trend remains constructive.” With a favourable risk-reward setup in place, Matalia states that this makes Ashok Leyland a strong candidate for Muhurat trading and beyond, as the Auto sector gears up for a renewed upcycle.
Muhurat trading, a special one-hour session held annually on Diwali, is considered an auspicious time to begin new investments, guided by age-old traditions and market optimism. Though symbolic in nature, it often sets the tone for the near-term market sentiment, with many market participants using this window to realign portfolios or initiate fresh positions for the new Samvat year.
As markets prepare to open for the special one-hour Diwali session tomorrow, such sector-specific strategies are likely to help investors and traders align with broader structural trends, while balancing festive optimism with technical discipline.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)