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Here are answers to readers’ queries on the performance of their stock holdings.
What is the short, medium and long-term outlook for the stock of Aurobindo pharma, purchased at ₹694?
S Sudhakar Reddy
Aurobindo Pharma (₹589.1): The stock of Aurobindo Pharma has been in an intermediate-term downtrend since encountering a key resistance at around ₹890 in October 2016. Following a corrective up-move, the stock met with a significant long-term resistance at ₹800 in early November 2017 and resumed its downtrend. Since then, the stock has been in a medium-term downtrend. The stock breached a key support at ₹640 in late January and is oscillating around the next support level of ₹600 over the last couple of weeks. Moreover, the stock has a significant long-term support in the band between ₹530 and ₹550 which can provide cushion if there is a further fall.
Investors with a long-term perspective can make use of such declines to accumulate the stock while maintaining a long-term stop-loss at ₹515 levels. You can consider averaging the stock with a stop-loss at ₹515. An upward reversal from the key support levels can take the stock northwards to the ₹640-₹650 band initially. Further breach of this range can take the stock higher to ₹700 and ₹750 levels in the medium to long term. Subsequent vital resistances are pegged at ₹800 and ₹900. On the other hand, if the stock decisively plunges below ₹530, the possibility of an upward reversal will be ruled out and, in that case, it can decline to ₹500 or ₹450 levels. The short-term trend is down. However, the stock tests a key support at around ₹600 backed with good volume and the downtrend could come to an end in the short term.
What are the technicals for the stocks of Radico Khitan and KEC International.
Abhaya Kumar
Radico Khitan (₹348): The stock of Radico Khaitan broke through a significant long-term resistance band between ₹185 and ₹200 in October 2017 and continued to trend upwards. The long-term uptrend got accelerated this January and the stock registered an all-time high at ₹417 on January 23. However, the stock changed direction and has been in a short-term down trend since then. An emphatic breach of the immediate support in the ₹310-₹300 zone will weaken the uptrend and drag the stock down to ₹260 over the medium term. Subsequent supports are pegged at ₹225 and ₹200. A decisive rally beyond ₹370 can strengthen the uptrend and push the stock higher to ₹400 and ₹420.
KEC International (₹392): Across all time-frames, the stock of KEC International is in an uptrend. Reinforcing the uptrend, the stock gained 9.4 per cent last week breaking above a key hurdle at ₹365.
Further rally beyond ₹410 can take the stock northwards to ₹450 in the long run. As long as the stock trades above the key base level of ₹240, the long-term uptrend will remain in place. Investors with a long-term horizon can stay invested with a stop-loss at ₹230. A conclusive slump below ₹240 will mitigate the uptrend and drag the stock down to ₹200 and ₹160 in the long term. Near-term supports are at ₹365 and ₹350. A conclusive decline below the key support level of ₹320 will alter the medium-term uptrend and pull the stock down to ₹300 and ₹280.
Send your queries to techtrail@thehindu.co.in
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