Here are answers to readers’ queries on the performance of their stock holdings.
What is the technical outlook for Bajaj Auto?
Prakash Mayani
Bajaj Auto (₹3,303.2): The stock of Bajaj Auto surged almost 3 per cent last week, breaching its 21-day moving average. However, it tests a key medium-term resistance at ₹3,350. This resistance has been capping the upside for the stock since late November 2017. A strong breakthrough of this hurdle is required to strengthen the medium as well as short-term uptrend and take the stock higher to ₹3,500 in the short term.
Further rally above this level can take the stock northwards to ₹3,700 and ₹4,000 in the long term. That said, if the stock reveres down from the current resistance, it can witness a near-term decline to ₹3,250 and ₹3,150 levels. Only a conclusive fall below ₹3,150 will alter the short-term trend downwards and drag the stock down to ₹3,000 and ₹2,950 levels. Further plunge below ₹2,950 will alter the stock’s medium-term uptrend and pull it down to ₹2,850 and ₹2,700 levels in the medium term. The long-term uptrend will be in place as long as the stock trades above ₹2,500 levels. Investors with a long-term perspective can stay invested with stop-loss at ₹2,400 levels. Next key supports below ₹2,500 are placed at ₹2,350 and ₹2,200 levels.
What is the outlook for Shankara Building Products, bought at ₹2,000 and now trading at around ₹1,700.
Srinivasan N
Shankara Building Products (₹1,692.1): Since listing in April 2017, the stock of Shankara Building Products has been on an intermediate-term uptrend. Nevertheless, the stock encountered a key resistance, after recording a new high of ₹2,365 in early December and changed direction. The stock has been in a short-term downtrend since then. While trending down, the stock emphatically breached key support at ₹2,000. However, the stock found support at ₹1,700 in mid-December. This base has been cushioning the stock since then.
The stock currently tests the support once again but the bias is negative. A plunge below this support can triggering selling pressure and drag the stock down to ₹1,500 in the short term. Further decline below ₹1,500 can pull the stock down to ₹1,250, which is key medium-term base. Subsequent supports are at ₹1,100 and ₹1,000. Investors with a long-term perspective can stay invested in the stock with a stop-loss at ₹950. You can consider booking the loss and re-entering at lower level, if the stock decisively breaks below ₹1,700 levels. Vital resistances are at ₹1,850 and ₹2000. A decisive rally above ₹2000 is required to take the stock higher to ₹2,200 and ₹2,300 levels.
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