Long-term resistance ahead for Tata Steel

Tata Steel surged over 5 per cent intra-week to record a high of ₹692. The stock, however, has come off from this high, giving up some of the gains to close 3.6 per cent higher for the week. The stock has been moving higher consistently and has closed in the green for the seventh consecutive week. Immediate resistance is at ₹685. A strong break above this hurdle can take it higher to ₹700 or ₹710. The region between ₹700 and ₹710 is a key long-term support zone. Since the stock has been on a continuous rally, the ₹700-₹710 zone is more likely to halt the current rally. A downward reversal on the back of profit booking from this hurdle cannot be ruled out. Such a pull-back move can take Tata Steel to ₹670, ₹650 or even lower. Investors can hold the long positions with the revised stop-loss at ₹640. Move the stop-loss higher to ₹660 as soon as the stock moves up to ₹698. Watch the price action at ₹700 and exit the long positions if it declines below ₹690 after testing the ₹700-₹710 resistance zone.

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