Last week, SBI gained almost 5 per cent, decisively breaching its key resistance at ₹1900. Nevertheless, it has encountered another significant resistance in the band between ₹ 2030 and ₹2050. The stock's daily indicators such as relative strength index and price rate of change are displaying negative divergence implying a short-term trend reversal. Therefore, a volte-face from the aforementioned resistance band will drag the stock down to ₹1900 initially. A further fall can pull it down to ₹1800. Important resistance above ₹2050 is at ₹2200. Traders with short-term perspective should tread with caution as long as the stock trades between ₹1900 and ₹2050. Investors with medium-term perspective can hold the stock with a stop-loss at ₹1,650.

ITC (₹343.8)

ITC closed marginally lower last week and is wavering with negative bias. Its support at ₹340 is cushioning the stock’s fall, for now. The stock is hovering well below its 21-day moving average. With indicators in the daily chart losing strength, a downward break of this support can pull the stock down to ₹335 and ₹330 in the ensuing weeks. Traders can short the stock while maintaining a stop-loss at ₹352. A conclusive decline below its key support at ₹330 will mitigate the short-term uptrend and drag the stock lower to ₹320 or ₹310 in the medium term. Hence, investors with medium-term perspective can desist trading in the stock and re-enter at lower levels. Key resistances to watch are positioned at ₹354 and ₹362.

Infosys (₹3,235.8)

Infosys fell 2.4 per cent last week and is now testing a key support zone between ₹3,200 and ₹3,220, from which it bounced back in late March. This support zone is an important Fibonacci retracement level as well as a long-term support. The company is scheduled to announce its Q4 earnings and FY-15 guidance on Tuesday. Hence, traders should tread with caution and take positions accordingly. A positive guidance can push the stock higher to ₹3,350 and ₹3,450. In such a scenario, traders can buy the stock with a stop-loss at ₹3200. But a negative surprise and a decisive fall below ₹3200 can drag the stock down to ₹3,100 or ₹3,000. Investors with a medium-term perspective can stay invested as long as the stock trades above ₹3,000.

Reliance Industries (₹952.8)

The stock extended its bull-run last week, gaining one per cent. However, the stock encountered resistance at ₹970 and started to decline. The daily indicators are showing negative divergence implying a short-term trend reversal. Volumes are also on a decline over the previous week. Traders with short-term perspective can thus take profits off the table at this juncture and wait on the sidelines. A fall below the immediate support at ₹940 can pull the stock down to ₹925 and then to ₹ 900 in the short-term. Medium-term trend is bullish. Investors with medium-term perspective can make use of the declines to buy the stock with a stop-loss at ₹885. The stock has the potential to touch ₹1,000 in the medium-term.

Tata Steel (₹420.1)

The stock moved higher in line with our expectations, gaining 4.5 per cent last week. While trending up, it decisively breached a key resistance at ₹400 which is now a key support level. The stock has been on a short-term uptrend since taking support at ₹340 in March. The stock is trading well above its 21- and 50-day moving averages. Traders can hold their long positions with a revised stop-loss at ₹403. Targets are ₹430 and ₹440. The indicators in the daily chart are hovering in the positive zone implying bullish momentum. Moreover, there has been an increase in volume in the last three trading sessions. Significant supports to note are at ₹410, ₹400 and ₹390.

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