The Hindu Business Line : SBI may turn weak

SBI (Rs 938.6): Contrary to expectations of a marginal downside move, the stock ruled firm during the week. It turned weak on Friday, after hitting the target zone of the Rs 945-950 range mentioned in earlier weeks. The near-term trend is bearish and a drop to the Rs 875-885 range appears likely. Investors may hold with a stop-loss at Rs 910. A trailing stop-loss may be used in the event of a rally beyond Rs 950. Fresh exposures may be considered on evidence of support at the Rs 875-885 range. The long-term trend is bullish and a move to the Rs 1150-1200 range appears likely.

Reliance Ind (Rs 793.5): Similar to SBI, the share price of Reliance, too, ruled firm, quite in contrast to expectations of a drop to the Rs 710-720 range. The near-term trend appears weak and a drop to the Rs 770-775 range appears likely. The resistance for the stock is at Rs 815. Long positions may be considered on price weakness as the stock could resume the bullish trend after the completion of the short-term drop. A close below Rs 730 would impart prolonged weakness and would delay the start of the next segment of the upward move. The share price appears to be headed towards the long-term target zone of the Rs 925-950 range.

Tata Steel (Rs 423.5): The stock continues to trade within the zone marked by the positive trigger level at Rs 425 and the bearish trigger level at Rs 390. A drop below Rs 390 would push the stock to the Rs 375-380 range; a close above Rs 425 would result in the resumption of the positive trend. Hold with a stop-loss at Rs 389. Fresh exposures may be avoided. Use a trailing stop-loss in the event of a rally past the resistance at Rs 425.

Satyam Computer (Rs 560.1): The failure to drop below the negative trigger level of Rs 513, along with a break above the positive trigger level at Rs 550, effectively negated the bearish outlook. The stock turned bullish subsequently and moved to a high of Rs 566 and closed a tad lower on Friday. The stock could move to the near-term target zone of the Rs 575-580 range. Hold with a stop-loss at Rs 540 and reduce exposures on rally.

Infosys (Rs 2,517): The near-term outlook is positive and a move to the Rs 2,580-2,600 range appears likely. Remain invested with a stop-loss at Rs 2,420. Fresh exposures may be avoided for the moment. The earlier view of a rally to the Rs 2,650-2,700 range remains valid. Long positions may be considered on weakness.

... ... ... ... ..Follow-up... ... ... ... ..

Sesa Goa (Rs 1,050): The stock ruled firm and recorded a gain of about Rs 83 for the week. As observed last week, there is a possibility of a short-term correction that could push the stock to the Rs 885-900 range. Investors may hold with a stop-loss at Rs 1,000.

Fresh exposures maybe considered on price weakness, as the long-term trend is bullish and a move to the Rs 1,150-1,200 range is on the cards. Investors may contemplate long positions on a drop to the support zone of Rs 900. Those who have entered at fairly lower levels may hold with a stop-loss at Rs 850. The long-term positive trend would be negated on a weekly close below the Rs 850 mark.

Chemplast Sanmar (Rs 86.9): The price movement was in line with last week's expectations. The stock ruled weak and appears on course to drop to the support zone of the Rs 80-82 range. The long-term uptrend would resume on the completion of the expected corrective phase.

The long-term target is placed at the Rs 115-120 range. Investors may hold with a stop-loss at Rs 75. Fresh exposures may also be considered on price weakness, with the earlier-mentioned stop-loss level. A close below Rs 75 would delay the start of the next leg of the upward move, but would not invalidate the positive outlook.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page