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.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.