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Here are answers to readers’ queries on the performance of their stock holdings.
I bought Kaveri Seed at ₹755. Should I hold?
TS Jaganath Rayan
Kaveri Seed Company (₹601.8): Last week, the stock of Kaveri Seed Company plummeted 20 per cent, breaking a key long-term support in the band between ₹700 and ₹730. With this fall, the stock has reached the oversold territory and is currently poised at the next base level of ₹600.
A corrective rally can occur in the near term. However, as the long-term picture has changed, you can use these rallies to exit the stock and re-enter later.
Ever since recording an all-time high at ₹1,077 levels in March 2015, the stock has been on an intermediate-term downtrend. The recent fall has strengthened the downtrend. The stock trades well below its 21- and 50-day moving averages. An emphatic fall below ₹600 levels can pull the stock down to ₹540 and then to ₹500 levels in the medium to long-term. Conversely, to alter the short-term downtrend, the stock needs to rally above ₹700 for an up move to ₹750 and ₹800 levels.
Only a strong break through the significant resistance at ₹840 will alter the intermediate-term downtrend and push the stock northwards to ₹900 and ₹950 levels in the medium term.
I have shares of Clariant Chemicals. Should I hold or book loss? What is the future of this stock?
Vineet Suman
Clariant Chemicals India (₹799.7): The stock moved back from the key resistance level of ₹1,037 in January 2015 and again in April. Since then, it has been on a medium-term downtrend. But the stock's important support at ₹800 provided base in late March and May. It now tests this support once again. As the stock has breached its 50 and 200-day moving average recently, the bias is bearish.
Therefore, a strong downwards break below ₹800 can reinforce the medium-term downtrend and pull the stock down to ₹750 or ₹700 levels in the medium term. You can consider booking loss and re-entering at lower levels. Subsequent key supports are pegged at ₹650 and ₹600 levels.
On the other hand, the stock’s immediate resistances are at ₹850 and ₹900 levels. A conclusive rally beyond ₹900 can take the stock upwards to ₹1,000 and ₹1,037 in the medium term.
What is the long-term outlook for Amtek Auto bought at ₹171 levels?
AK Padwal
Amtek Auto (₹149.2): The stock has been consolidating sideways in the wide range between ₹130 and ₹170 since February 2015. The stock tested its upper boundary for almost one month and eventually fell 10 per cent last week.
A decisive break above the upper boundary of the range is required to boost the bullish momentum and push the stock higher to ₹200 and then to ₹220 levels in the medium term. Immediate resistance is poised at ₹160.
Investors with a medium to long-term horizon can hold the stock with a stop-loss at ₹130. Key resistances beyond ₹220 are placed at ₹240 and ₹265 levels.
Conversely, a strong plunge below the significant base level at ₹130 will have bearish implications; exit the stock and re-enter at lower levels. Next important supports are pegged at ₹110 and ₹92 levels.
Send your queries to techtrail@thehindu.co.in
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