Crisil reverses from a key base

A break above ₹1,650 will take the stock up to ₹1,800 over the medium term

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

Can I buy the stocks of Crisil and CARE at the current levels. What are the supports and resistances?

Prakash Rao

Crisil (₹1,544.6): The stock of Crisil gained almost 3 per cent last week, breaching a key resistance at ₹1,500. This rally underpins bullish momentum and the stock can continue to trend upwards in the short term. The long-term trend has been down for the stock since recording a new high at ₹2,490 in October 2016. However, it found support at ₹1,260 this October and bounced up strongly. The long-term downtrend appears to have come to a halt at this multi-year low of ₹1,260 and the stock has been on a short-term uptrend since late October.

 

 

You can buy the stock in dips while maintaining a stop-loss at ₹1,350. Investors with a long-term perspective can also buy with the stop-loss at ₹1,350 levels. An emphatic break above the key barrier at ₹1,650 will pave way for an up-move to ₹1,750 and ₹1,800 in the medium term. But the stock could face difficulty in surpass ₹1,800 because of significant long-term resistance.

A strong break-out of this hurdle will take the stock higher to ₹1,950 and ₹2,000 in the long run. On the downside, a fall below the immediate support level of ₹1,480 can pull it down to ₹1,400 and ₹1,350 levels.

That said, a conclusive plunge below ₹1,350 will mar the bullish stance and drag the stock down to ₹1,300 and ₹1,250 levels.

CARE Ratings (₹991.2): The stock of CARE Ratings has been on an intermediate-term downtrend since recording a high of ₹1,800 in July 2017. This September, the stock breached a key support at ₹1,200 and continued to trend downwards.

Both the medium as well as short-term trends are also down for the stock. But the stock recently found a temporary base at ₹951 and began to move higher. It has a key long-term support in the ₹860-900 band.

 

 

A fall below ₹950 can take support at the long term base zone.

Investors should tread with caution and consider buying at lower levels with a stop-loss at ₹850. Immediate resistances are at ₹1,050 and ₹1,100.

A strong rally above these resistances will show signs of bullish momentum and take the stock up to ₹1,200, which is a significant short-term trend-deciding level.

Only a decisive break above ₹1,200 will alter the short-term downtrend and take the stock up to ₹1,300 and ₹1,400 over the medium term horizon.

To alter the intermediate-term downtrend, the stock needs to advance above ₹1,450. Key resistances above this level are placed at ₹1550 and ₹1600.

Conversely, a conclusive fall below the vital base level of ₹860 will reinforce the downtrend and drag the stock down to ₹800 and then to ₹700 over the long term.

Send your queries to techtrail@thehindu.co.in

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