The stock was very volatile in the previous week, first declining to an intra-week low of Rs 765 and later rebounding sharply. It gained almost 4 per cent with good volume in the previous week. The stock is currently testing key resistance at Rs 850. The daily and weekly relative strength indices are climbing higher in the neutral region towards the bullish zone. Only a strong breakthrough of this resistance will indicate that the short-term downtrend is over and the stock is heading towards next resistances at Rs 870 and Rs 890. In that case, short-term traders can consider initiating long positions with stop-loss at Rs 850. The continuation of the rally can take the stock higher to Rs 920 and to Rs 940 over the medium-term.

Immediate key supports for the stock are positioned at Rs 830 and Rs 800-810 band. Significant support below Rs 800 is in the zone between Rs 770 and Rs 780. Drastic decline below this support band will pull the stock down to Rs 740 over the medium-term.

State Bank of India (Rs 1,514.4)

The stock prolonged its downtrend in the previous week by declining almost 3 per cent. Nevertheless, the stock is still testing its significant support zone between Rs 1,500 and Rs 1,510. The daily indicators and oscillators are displaying positive divergence indicating that trend reversal is in the offing. But the stock needs to move above its immediate resistances at 1,640 and then Rs 1,710 to confirm the trend reversal. Short-term traders should tread with caution in the ensuing week too.

A strong fall below Rs 1,500 will strengthen the stock’s downtrend and drag it down to its next support positioned in the range between Rs 1,390 and Rs 1,400.

Key resistances above Rs 1,710 are positioned at Rs 1,800 and Rs 1,900. The stock has been on a medium-term downtrend from its January peak of Rs 2,549 levels. This trend remains in place as long as the stock trades below Rs 2,000.

Infosys (Rs 3,100.3)

Last week, the stock decisively broke through its significant resistance band between Rs 2,950 and Rs 3,000, by gaining 3.4 per cent with good volume.

This indicates that the stock is heading towards our medium-term price target of Rs 3,225.

Traders can consider holding their long position with stop-loss at Rs 3,045 levels.

Both medium and short-term trends are up for the stock. It is trading well above its 50 and 200-day moving averages. The daily indicators are featuring in the bullish zone. Significant supports to watch in the week ahead are at Rs 3,000, Rs 2,900 and Rs 2,800 levels.

Tata Steel (Rs 274.2)

Tata Steel was choppy and fell 2.8 per cent in the week ago. However, its short-term trend is up. It is hovering well above its 21 and 50-day moving averages. The daily relative strength index is featuring in the bullish zone and the weekly RSI is trending higher in the neutral region. Traders with a short-term perspective should tread with caution as the stock is facing resistance at Rs 290. Strong breakthrough of this resistance will pave the way for an up-move to Rs 300 and then to Rs 320 in the coming weeks.

Conversely, a decline below its immediate support at Rs 260 will pull the stock down to Rs 245 or even to Rs 230 levels in the short-term. The stock needs to rally above Rs 350 to alter its medium-term downtrend.

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