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Investors with a short-term perspective can consider selling the stock of Coromandel International at current levels. The stock is experiencing selling pressure and had extended its recent decline by slumping 3 per cent with above average volume on Thursday. This fall has decisively breached the key support at ₹470 and the 50-day moving average.
Following a short-term uptrend, the stock encountered a key resistance in the band between ₹510 and ₹520 in early March and again in early April this year. Subsequently, the stock reversed direction and started to decline. So far, the stock has tumbled more than 8 per cent this week and has formed a bearish engulfing candlestick pattern in the weekly chart. This pattern is a reversal pattern and backs the stock’s downward reversal.
The daily relative strength index has entered the bearish zone from the neutral region and the weekly RSI hovers in the neutral region. Besides, the daily price rate of change indicator has entered the negative territory implying selling interest. The near-term outlook is bearish for the stock. Targets are ₹438 and ₹428. Traders can sell the stock with a stop-loss at ₹466.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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