Technical Analysis

Kaveri Seed Company (₹510.3): Sell

Yoganand D BL Research Bureau | Updated on February 12, 2019 Published on February 13, 2019

  Investors with a short-term perspective can consider selling the stock of Kaveri Seed Company at current levels.

On Tuesday, the stock tumbled 5 per cent accompanied by above average volume, breaking below the key long-term support at ₹535. This fall has reinforced the short-term downtrend that commenced from the February 1 high of ₹623. While trending down, the stock had decisively breached its 50- and 200-day moving averages. Moreover, the stock appears to have resumed its intermediate-term downtrend that has been in place since encountering a key resistance at ₹650 in September 2018.

The daily relative strength index features in the bearish zone and the weekly RSI is on the brink of entering the bearish zone from the neutral region. Likewise, the daily price rate of change indicator hovers in the negative territory implying selling pressure and the weekly counterpart is on the verge of entering the negative territory.

The short-term outlook is bearish for the stock. It can continue to trend down and reach the price targets of ₹490 and ₹480 in the ensuing trading sessions. Traders can sell the stock with a stop-loss at ₹521.

(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)

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