Near term view is negative for ITC



ITC fell for the second consecutive week and was down 1.5 per cent. The fall last week has taken the stock well below the key support level of ₹263. The levels of ₹264 and ₹266 – the 21-day moving average are the key near-term resistances. A strong break above ₹266 is needed for the downside pressure to ease and take the stock higher to ₹270 or ₹272. Inability to break above ₹272 can drag the stock lower to ₹265 and ₹263 again. On the other hand, if ITC continues to sustain below ₹264 and ₹266 in the coming days, there is a strong likelihood of it falling to ₹256. A break below ₹256 can then drag the stock further lower to the crucial support zone of ₹252 and ₹250. Whether the stock manages to reverse higher from there or not will decide the next leg of move. Short-term traders with high risk appetite can go short on rallies at ₹264. Keep the stop-loss at ₹267 for the target of ₹258. Revise the stop-loss lower to ₹262 as soon as the stock moves down to ₹260.

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