The Hindu Business Line : Pivotals waiting for a breakout

The view expressed in earlier weeks of a drop to Rs 550-Rs 560 range remains valid. This view would gain credence if the stock drops below Rs 605. Remain invested with stop loss at Rs 620 and book profit on price rise. Fresh buying may be deferred for the moment. The bearish trend would be negated only if the stock closes above Rs 750.

HLL (Rs 122.4): The share price appears on course to move towards the earlier major low formed at Rs 115.

The recent price pattern indicates the possibility of a drop to Rs 100. The ongoing move is, however, expected to end after the drop below Rs 115 and possibly after a test of Rs 100. Evidence of support at or around the Rs 100 mark may be used to take fresh exposures.

Those having long positions may have a stop loss at Rs 120. If the stop loss gets triggered, fresh buying may be considered if the downward move gets arrested at Rs 100-Rs 105 range.

Infosys (Rs 1,382.6): The stock dropped below the stop loss level of Rs 1,340 on Thursday and Friday. The near-term trend is strong and a move to the Rs 1,490-Rs 1,500 range appears likely. Only a close below Rs 1,320 would negate this view.

Remain invested with a stop loss at Rs 1,320 and use price upmoves to reduce exposures.

Those willing to take risk may consider long positions on a move past Rs 1,450, with a close stop loss in place.

Tata Motors (Rs 415.6): As expected last week, the move past Rs 392 has been positive for the stock. The price movement has been marked by high degree of volatility, which has made the task of meaningful analysis of the short-term trend difficult.

The recent price patterns indicate that the stock has staged a breakout from a downward sloping "wedge" pattern. This would have positive implications and could push the stock to higher levels. Remain invested with a stop loss at Rs 390.

Reliance Ind (Rs 434.1): Similar to the key indices, the share price of Reliance, too, has been moving in a sideways trend. A breakout from this trading range would be an imperative for the emergence of any significant trend.

Till such time, it would better to refrain from taking any trading positions. From a long-term perspective, the possibility of a drop to Rs 360-Rs 370 range is still valid.

(Note: The analysis and opinion expressed in these columns are based on the technical analysis of the past price behaviour. Opinion and price targets are based on the Elliott Wave Analysis. The stop-loss level provided with the recommendation is important. The original view would stand negated if the stop loss level is breached. There is a risk of loss in trading)

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