Technical Analysis

Sizzling Stocks: DLF (Rs 218.6)

Yoganand D. | Updated on October 01, 2011 Published on October 01, 2011

DLF jumped 10 per cent in the previous week with above average weekly volumes. It has managed to penetrate its immediate key resistance at Rs 210, which it had been struggling to do in September. Short-term trend is up for the stock from its August low of Rs 173. The stock is hovering above its 21- and 50-day moving averages. However, it is facing twin resistances (downtrend line and a resistance) in the band between Rs 225 and Rs 230. A strong breakthrough of this band will take the stock higher to Rs 250 in the medium-term.

Conversely, failure to surpass the above-said resistance can pull the stock down to Rs 210 and Rs 195. Subsequent medium-term support is pegged at Rs 175.

Amtek India (Rs 137.5)

The stock surged 11 per cent with good weekly volumes in the last week. Ever since bottoming out in the last quarter of 2008, the stock has been on a long-term uptrend. Medium as well as short-term trends are also currently up. However, the stock is currently testing its long-term resistance level at Rs 140. Its weekly relative strength index is displaying negative divergence signalling a potential trend reversal. Inability to move beyond Rs 140 will pull the stock down to Rs 120, Rs 110 and to Rs 90 in the medium-term.

But a conclusive breakthrough of Rs 140, after following a sideways move between Rs 120 and Rs 140, can lift the stock northwards to Rs 160 and to Rs 180 in the medium-term.

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