Technical Analysis

Bank of India needs to cross a barrier

Yoganand D | Updated on November 22, 2014 Published on November 16, 2014

A strong break will take the stock higher to the levels of ₹330 and ₹350



Here are answers to readers’ queries on the performance of their stock holdings

Please discuss the medium- to long-term outlook on Oriental Bank of Commerce and Bank of India.

Suneeta Y

Oriental Bank of Commerce (₹289.9): The stock's long-term downtrend found support around ₹120 and came to a halt in August 2013. Since then, the stock has been on an intermediate-term uptrend. However, this up move was unable to breach a key resistance at ₹366 in June.

Over the last three months, the stock has been finding it difficult to breach a key resistance band between ₹290 and ₹300.

A decisive break of this long-term resistance band will reinforce bullish momentum and take it northwards to ₹330 and ₹366 in the medium term.

However, the stock needs to emphatically rally above ₹366 to alter its long-term downtrend. In such a scenario, long-term targets are ₹400 and ₹440 levels.

On the downside, the failure to move beyond ₹300 can pull the stock down to ₹260. Next significant support below ₹260 is between ₹220 and ₹230. Investors can hold the stock with a stop-loss at ₹220. A decisive fall below ₹220 will mar the intermediate-term uptrend and pull the stock down to ₹200 and then to ₹160 in the long term.

Bank of India (₹285.3): Bank of India failed to break through the key resistance at ₹300 between July and September. A strong breach of this level will strengthen the uptrend and take it higher to ₹330 and ₹350 in the medium term. Conversely, the inability to surpass ₹300 will keep the stock moving sideways between ₹260 and ₹300. But a fall below ₹260 will drag the stock down to ₹230 in the medium term.

To alter the long-term downtrend that has been in place from the October 2010 peak of ₹588, the stock needs to emphatically rally above ₹350. Targets are ₹380 and ₹410 levels. Investors with long-term perspective can hold the stock with a stop-loss at ₹230. On the other hand, a fall below ₹230 can pull the stock down to ₹205 or even to ₹170 levels.

What is the medium term outlook for PTC India financial services?

P Sarala

PTC India Financial Services (₹51.7): In May 2014, the stock of PTC India Financial Services emphatically broke out of a key long-term resistance at ₹20 and started trending upwards. Since then, it has been on an intermediate-term uptrend.

However the volumes started to dwindle as the stock price surged. After registering an all-time high at ₹58 in the previous week, the stock began to fall. The indicators in the weekly chart are showing bearish signals, indicating that the current uptrend is coming to a halt.

A fall below the immediate support at ₹48 will start to weaken the uptrend, and the stock can trend lower to ₹41 and then to ₹36 levels. A conclusive breach of these levels can take the stock even lower to ₹30 or ₹23 levels in the medium term. On the upside, a break of immediate resistance at ₹58 can take the stock higher to ₹65 or ₹70 levels in the medium term.

Kindly give me the future prospects of Akzo Nobel India.

Devidas L Pai

Akzo Nobel India (₹1,254.8): The stock has a significant long-term support at ₹750, at which it took support in September 2013 and again in February 2014 and started trending upwards.

Since then, the stock has been on an intermediate-term uptrend. Long-term trend is also up.

This uptrend will remain in place as long as the stock trades above ₹750 levels.

Significant supports are pegged at ₹1,150, ₹1,050 and ₹900 levels. Resistances are at ₹1,320 and ₹1,400 levels. Investors with a long-term outlook can stay invested with a stop-loss at ₹750.

A fall below this level can drag the stock down to ₹600 and then to ₹500.

Send your queries to techtrail@thehindu.co.in

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