Tata Steel (₹390.4)

The stock of Tata Steel has been moving sideways in the band between ₹380 and ₹420 since mid-December 2014. Only a strong plunge below ₹380 will reinforce the stock’s intermediate-term downtrend that has been in place since July 2014. This can drag the stock down to ₹360 and then to ₹340. On the upside, the stock needs to conclusively rally above ₹420 to alter the short-term outlook into bullish and take it northwards to ₹430 and ₹440. Immediate resistance levels are at ₹400 and ₹410. Traders with a short-term perspective can remain on the sidelines for now. While the indicators in the daily chart are showing signs of trend reversal, the stock needs to emphatically break ₹420 for confirmation of the uptrend.

SBI (₹310)

Following a blip above the significant long-term resistance at ₹327, the stock fell 5 per cent on Friday. This fall led to formation of a bearish engulfing candlestick pattern in the weekly chart, indicating a trend reversal. The negative divergence in the weekly indicators also suggests the same. Moreover, the stock has closed just below its 50-day moving average, showing signs of weakness. Traders with a short-term perspective can initiate short position on rallies with a stop-loss at ₹318. The targets are ₹300 and ₹290. A strong fall below ₹290 can pull the stock down to ₹270 in the medium term. Therefore, investors with a medium-term view can consider taking partial profits off the table at this juncture and re-enter at lower levels. Key resistance levels are pegged at ₹320, ₹327 and ₹340.

ITC (₹368.6)

The stock took support at ₹350 and reversed higher, gaining 5.6 per cent last week. But it is testing a key resistance at ₹370. This level needs to be decisively breached to alter the short-term downtrend and take the stock northwards to ₹378 and ₹390 levels in the medium-term. In such a scenario, traders with a short-term perspective can buy the stock above ₹370 with a stop-loss placed at ₹365. The inability to breach the key resistance will keep the stock trading range bound between ₹350 and ₹370. Both daily and weekly indicators are hovering in the neutral region implying neutral stance. Only a strong fall below ₹350 will strengthen the downtrend and pull the stock down to ₹340. Next key support levels are pegged at ₹330 and ₹315.

Infosys (₹2,142.7)

The stock failed to break its significant resistance at ₹2,200; instead it declined 3 per cent last week. The short-term uptrend that has been in place since mid-December 2014 is losing momentum. The daily relative strength index has entered the neutral region from the bullish zone. A fall below the immediate base level of ₹2,115 can pull the stock to ₹2,020. Hence, traders should tread with caution and initiate fresh short position on such a fall with a stop-loss at ₹2,150. Further decline below ₹2,020 will mar the short-term uptrend and drag the stock down to ₹1,950, ₹1,900 and ₹1,800. Conversely, an emphatic breakthrough of ₹2,200 can take the stock higher to ₹2,300 in the short term. Investors with a medium-term view can stay invested with a stop-loss at ₹1,800.

RIL (₹915.3)

Last week, the stock conclusively breached its crucial resistance at ₹900, but encountered hurdle at the subsequent resistance at ₹925. It has gained 3 per cent in the last week. The stock is hovering around a short-term trend deciding level. The stock is trading above its 21- and 50-day moving averages. The indicators in the daily chart are on the brink of entering the positive territory from the neutral region. A strong break-out of the key resistance at ₹925 will change the stock’s short-term trend into bullish and take it higher to ₹945 and ₹960. As long as the stock trades above ₹900, the bullish momentum will remain in place. Traders with a short and medium-term perspective can buy the stock with a stop-loss at ₹890. A decisive fall below ₹900 can pull the stock down to ₹860 and then to ₹840.

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