Reliance Industries (Rs 865.4)

Last week, the stock was very choppy and advanced marginally by Rs 8. Short-term trend is still under threat as the stock has been testing key support at Rs 850 for the past one week. Strong downward breakthrough of this support will pave the way for a decline to Rs 830 or to the Rs 800-810 support zone in the short-term. Next important support is positioned at Rs 770.

On the other hand, the stock needs to emphatically rally above Rs 890 to reinforce the bullish momentum and push the stock higher to Rs 920 and then to Rs 940 in the medium-term. Medium-term investors can enter the stock on a strong rally above Rs 890.

State Bank of India (Rs 1,661.4)

State Bank too was volatile but fell Rs 20 or 1.2 per cent in the previous week. Medium and short-term trends are down for the stock. However, it is building a near-term base at around Rs 1,640 and key immediate support is placed at Rs 1,600. Traders can consider exiting their short positions and tread with caution in the upcoming week. Significant support below Rs 1,600 is at Rs 1,510.

An upward reversal from the band between Rs 1,600 and Rs 1,640 can take the stock northwards to Rs 1,800 initially and then to Rs 1,900. The stock needs to decisively move above Rs 1,900 to reverse its short-term downtrend and take it upward to the resistance band Rs 2,000 and Rs 2,030. To alter its medium-term downtrend, the stock needs to rally above Rs 2,100 level.

Infosys (Rs 2,961.1)

Infosys fell 1.5 per cent in the week ago and continues to test the important resistance band between Rs 2,950 and Rs 3,000. The daily indicators have started correcting from their over-bought levels implying near-term correction is in the offing. A conclusive breakout of Rs 3,000 will take the stock northwards to Rs 3,225 in the medium-term.

But, inability to surpass Rs 3,000 will confine the stock to moving sideways between Rs 2,800 and Rs 3,000 in the near-term. Significant support for the stock below Rs 2,800 is at Rs 2,700.

Medium-term trend has been up for the stock from its April 2013 low of Rs 2,190 levels. This trend will remain in place as long as the stock trades above Rs 2,600 levels.

Tata Steel (Rs 218.4)

Tata Steel surged 8 per cent, witnessing buying interest last week, in line with our expectation. After taking support at around Rs 200 which is a significant base level, the stock reversed direction triggered by positive divergence in daily relative strength index and price rate of change indicator. We notice that there has been an increase in volume in the past three trading sessions. However, it will be premature to conclude that the stock has changed direction.

The stock is currently testing resistance at Rs 220. An emphatic breach of this resistance will push it higher to Rs 230 and to Rs 240 in the short-term. Traders can initiate fresh long positions in that scenario with same stop-loss. But inability to surpass Rs 220 can pull the stock down to Rs 210 or to Rs 202 in the short-term.

Significant resistances above Rs 240 are positioned at Rs 250, Rs 264 and Rs 282. Support below Rs 200 is placed at Rs 175.

Related Topics
comment COMMENT NOW