Reliance Industries (Rs 898.9)

Last week, the stock decisively broke through its key resistance at Rs 860 by gaining 7 per cent accompanied by good weekly volume. With this rally, the stock appears to have resumed its medium-term uptrend that has been in place from its June 2012 low of Rs 673 levels.

The stock surpassed resistance at Rs 880 and is currently testing resistance at Rs 900. Short-term trend is also up for the stock. Traders with a short-term perspective can consider buying the stock with stop-loss at Rs 880. A conclusive rally above Rs 900 will push the stock higher to Rs 920 and Rs 930 in the ensuing week.

Supports for the stock are at Rs 860 and Rs 830.

Investors with a medium-term perspective can continue with their long holdings with stop-loss at Rs 790 levels. Medium-term targets for the stock are Rs 950 and Rs 965.

State Bank of India (Rs 2,491.2)

The stock was unstable and formed another doji candlestick pattern in the weekly chart signalling neutral view. It is still testing key resistance at Rs 2,500. Short-term traders should tread with caution and initiate fresh long position only if the stock emphatically moves above Rs 2,500 levels with stop-loss at Rs 2,450 level. In that scenario, the stock’s medium-term uptrend will strengthen and it can climb to Rs 2,600 levels.

Conversely, a fall below Rs 2,425 can pull the stock down to Rs 2,370 or to Rs 2,300 in the near-term. A strong decline below Rs 2,300 will mitigate the stock’s short-term trend and pull it down to Rs 2,240 and to Rs 2,125 levels.

Medium-term uptrend will remain in place as long as the stock treads above Rs 2,125 levels. Resumption of the uptrend will take the stock higher to Rs 2,750 in the medium-term.

Infosys (Rs 2,789.8)

The stock’s upward momentum prolonged last week, by gaining 2.8 per cent. However, its near-term stance is fraught with caution. As long as the stock trades above Rs 2,600, a key support level, its short-term trend remains up. Immediate support is pegged at Rs 2,700. An upward resumption will push the stock higher to Rs 2,900 in the medium-term. Subsequent support below Rs 2,600 is at Rs 2,500. Investors with a medium-term perspective can consider buying the stock on dips with stop-loss at Rs 2,600. Next significant resistance above Rs 2,900 is at Rs 3,000.

Tata Steel (Rs 414.6)

Tata Steel was volatile and fell marginally in the week ago. Its 200-day moving average hovering around Rs 410 is providing the base for the stock.

Further, the stock has significant support at Rs 400. Only a decisive decline below this level will mar its short-term uptrend and drag it down to Rs 387.

On the other hand, it has key resistance at Rs 430 levels, which has to be surpassed to signal that the bullish momentum is back. It can trend up to Rs 440 or Rs 450 in the medium-term.

In the short-term, the stock can move sideways between Rs 400 and Rs 430. Therefore, traders should tread with caution as long as the stock moves in the aforesaid range.

(This article was published on January 19, 2013)
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