SBI (₹213.4)
SBI managed to sustain above the psychological ₹200 mark last week and surged 3.5 per cent. It fell on the first trading day of the week to test ₹200, but subsequently reversed higher. Last week’s rally has taken it well above the 200-day moving average resistance at ₹209. A key trend line is also poised around ₹209, making this a strong support for the coming week. While the stock may test this support, a break below it is less probable. A reversal from ₹209 will keep the bullish view intact. A rise to ₹218 and ₹220 — the 38.2 per cent Fibonacci retracement resistance — is possible in the near term. Inability to break above ₹220 can trigger a pull back move to ₹210 or ₹205. But a strong break above ₹220 can boost the bullish momentum and take SBI higher to ₹225 immediately and to ₹230 and ₹240 thereafter. Traders with a short-term perspective can go long on dips near ₹209. Stop-loss can be placed at ₹203 for the target of ₹220. Revise the stop-loss higher to ₹212 as soon as the stock moves up to ₹216.
ITC (₹359.55)
The support at ₹344 in ITC, as expected, has held up well in the past week. The stock fell to a low of ₹345.7 early last week and reversed sharply higher to close with over 2 per cent gains for the week. A test of the key resistance at the level of ₹365 is possible in the coming week. Whether the stock manages to break above this hurdle or not will then decide the next leg of move. A reversal from ₹365 can take the stock lower to ₹355 or even ₹350 in the short term. In such a scenario, the stock can remain range-bound between ₹345 and ₹365 for some time. On the other hand, a strong break above ₹365 will boost the bullish momentum. Such a break can take the stock higher to ₹380 initially. This will also have the potential to take ITC higher to ₹400 over the short term. On the charts, the level of ₹345 is a strong support which is likely to limit the downside in the stock in the short term. Medium-term investors who have taken long positions last week can continue to hold it. Retain the stop-loss at ₹335 for the target of ₹390.
Infosys (₹1,178.3)
Infosys was stuck inside a narrow range between ₹1,166 and ₹1,194 last week. The weekly chart reflects indecisiveness in the market. Also, the stock hovering around the 100-day moving average at ₹1,181 leaves the immediate outlook unclear. Traders can stay away until a clear trend emerges. However, as long as the stock trades below ₹1,200, the short-term outlook will remain negative. A decisive close below the 100-day moving average will add pressure to the stock. In such as scenario, Infosys can fall to ₹1,150 and ₹1,140. The 200-day moving average at ₹1,140 is an important support . If the stock extends the fall, breaking below this support, it can test ₹1,120 and ₹1,110 on the downside. On the other hand, a reversal from the level of ₹1,140 can see a bounce back to ₹1,180 or even ₹1,200. A strong break above ₹1,200 will ease the downside pressure and take the stock higher to ₹1,220. Only a decisive break and a close above ₹1,220 will turn the outlook positive for the stock. The next targets will be ₹1,245 and ₹1,275.
RIL (₹973.25)
RIL was stuck in a narrow range between ₹964 and ₹985 in the past week. The immediate outlook remains unclear. Support is at ₹960 and resistance at ₹990. A breakout on either side of these two levels will decide the next leg of move for the stock. A strong break above ₹990 will ease the downside pressure. Such a break will increase the chances of the stock rising above the psychological ₹1,000 mark to ₹1,020 in the short term. Such a rise will also reduce the possibility of seeing any fresh fall in the stock. On the other hand, if RIL breaks below ₹960, it can fall to ₹950 or ₹940 in the near term. Further break below ₹940 will increase the downside pressure and drag the stock lower to ₹920 and ₹910 thereafter. The 200-week moving average at ₹908 is a crucial support for the stock. If the stock manages to reverse higher from this support, a bounce back to ₹950 is possible. But a decisive break and a weekly close below ₹908 will increase the danger of the stock declining to ₹850 and ₹830 over the medium term.
Tata Steel (₹325.5)
Tata Steel opened with a gap-down and closed 2.8 per cent lower in the past week. The stock was stuck inside a sideways range between ₹321 and ₹333. The 55-day moving average at ₹332 has restricted an up move in the stock through the week. A strong break above this hurdle is needed to take the stock higher to ₹340 and ₹345 levels. However, only a strong break and a decisive close above ₹345 will boost the bullish momentum to take the stock back to ₹360 or higher levels in the short term. Having said that, the near-term outlook will remain negative as long as the stock trades below this moving average resistance. Immediate support is at ₹320. A break below it can trigger a fall to ₹310 or even lower in the short term. However, as being reiterated in this column, ₹300-₹295 is a strong support zone and a break below it is unlikely. So medium-term investors can continue to hold the long positions. Accumulate longs on dips near ₹310 and ₹300. Retain the stop-loss at ₹285.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.