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Investors with a short-term horizon can sell the stock of V-Guard Industries at current levels. The significant resistance at ₹250 capped the upside in mid-April 2018. The stock subsequently changed direction and has been in a medium-term downtrend since then.
While trending down, the stock decisively breached a key support at ₹220 as well as the 200-day moving average in early June. After a corrective up-move, it met with a key resistance at ₹215 and resumed its downtrend in mid-June.
On Tuesday, the stock fell by 4 per cent accompanied with an above average volume, strengthening the downtrend. The stock now tests a key support at ₹200 with a negative bias.
The daily relative strength index has entered the bearish zone from the neutral region and weekly RSI has also entered the bearish zone. Both the daily and weekly price rate of change indicators are featuring in the negative terrain implying selling interest.
Overall, the short-term outlook is bearish for the stock. Short-term targets are ₹191 and ₹187. Traders can sell the stock with a stop-loss at ₹204.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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