SBI decisively breached its key support at ₹1,600 and tumbled 6 per cent last week. This decline was in line with expectations. The short-term trend in the stock is down. The stock is trading way below its 50- and 200-day moving averages. But the stock is now hovering just above the next important support at ₹1,500. It can hover around this support for a while. Therefore, traders should tread with caution in the ensuing week. Fresh short position can be initiated in rallies with a stop-loss at ₹1,600. Strong fall below ₹1,500 can pull the stock down to ₹1,455 or ₹1,409 in the short-term. Key resistances above ₹1,600 are at ₹1,650, ₹1,700 and ₹1,810.

ITC (₹325.1)

The stock traded in a narrow sideways range last week. The short-term trend has also been a sideways movement in the range between ₹308 and ₹330 since November 2013. Its 200-day moving average is poised around ₹330, making this an important resistance level. Indicators in the daily chart are hovering in the neutral region. Short-term traders should avoid trading in the stock as long as it is range-bound. An emphatic upward breakthrough will pave way for a rally to ₹340 and then to ₹355 in the short-term. Conversely, a fall below the level of ₹308 can pull the stock down to ₹297. Support below this level is at ₹285.

Infosys (₹3,699.4)

After a volatile session, the stock of Infosys fell 1.6 per cent last week. The stock has formed a spinning top candlestick pattern in the weekly chart, signifying indecisiveness. It is testing the key resistance at ₹3,750 levels. The indicators in the daily chart show that the stock is losing its short-term bullish momentum. Failure to rally above ₹3,750 will be an indication to initiate fresh short position with a stop-loss at ₹3,750. Downside targets are ₹3,600 and ₹3,450. But, a positive move above ₹3,750 can take the stock higher to ₹4,000 in the medium term. Investors with a medium-term perspective can hold their long positions with a stop-loss at ₹3,150.

Reliance Ind (₹830.8)

Last week, RIL tumbled 4 per cent, decisively breaching its 200-day moving average and the lower boundary of the sideways range at ₹840. The stock is hovering well below its 50- and 200-day moving averages. The daily chart indicators are featuring in the bearish zone. Indicators in the weekly chart are entering the bearish zone. Moreover, the short-term trend is down for the stock. Traders can initiate fresh short positions with a fixed stop-loss at ₹845. Targets are ₹820 and ₹800. A conclusive fall below ₹800 can drag the stock lower to ₹770 in the medium-term. Key resistances to watch for are pegged at ₹860 and ₹885. Subsequent resistances are placed at ₹910 and ₹930.

Tata Steel (₹356.1)

The stock of Tata Steel declined by 5.4 per cent last week. The short-term trend has been down from its January 2014 peak of ₹435. Nevertheless, the stock is testing its key support level at ₹350. It has an equally important resistance at ₹370. As long as the stock trade between ₹350 and ₹370, it will remain volatile and short-term traders should tread with caution. A decisive drop below ₹350 will strengthen its downtrend and pull the stock down to ₹333 and then to ₹320 in the medium-term. Important resistances above ₹370 are at ₹381 and ₹392. A strong move above ₹392 is needed to alter the short-term downtrend and take it higher to ₹410.

Snapshot

1 SBI is in a short-term downtrend.

2 Tata Steel is testing support at ₹350.

3 ITC continues to be in a sideways range.

4 The near-term view is indecisive for Infosys.

5 RIL conclusively breached the lower boundary of the range at ₹840.

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