The Hindu Business Line : Query Corner

Shareholders may remain invested with a stop-loss Rs 239. Fresh exposures may be considered at prevailing levels as well as on weakness, with a stop-loss at Rs 240.

Adlabs (Rs 392): There are signs of a slowdown in the momentum behind the recent rally. The stock could get into a corrective phase shortly.

It would be better to wait for confirmation about the pick up in momentum.

A close above Rs 410 would be an early indicator of the resumption of the long-term uptrend. Alternatively, a close below Rs 350 would be a sign of weakness.

Shareholders may remain invested with a stop-loss at Rs 350.

Fresh exposures may be considered either at levels closer to Rs 350 or on a break above Rs 410.

As always, have the stop-loss at a comfortable level in case of having decided to buy the stock on a move past Rs 410.

I hold shares in Cipla bought at Rs 682. What is the outlook for the stock? Pankaj Aggarwal, Gayathri Palaniyappan

Cipla (Rs 260): A close below Rs 230 would push the stock into a major corrective phase.

The stock is now in a short-term correction to the earlier upward move.

The long-term uptrend would resume on the completion of the short-term correction. Investors may have a stop-loss at Rs 230.

Fresh exposures may be deferred. A close above Rs 282 would impart strength and fresh exposures may be considered subsequently.

Please let me know if it is advisable to hold Tata Tea brought at Rs 1,015. J.P.Sharma

Tata Tea (Rs 837): The short-term outlook appears bearish. The stock could drop to Rs 680-690.

Fresh long positions may be considered on the evidence of support at this zone.

Shareholders may sell a portion of the holding at prevailing levels and have a stop-loss of Rs 760 for the balance.

Only a close above Rs 900 would negate the short-term bearish outlook.

Please furnish your views on Wockhardt and Orchid Chemicals using the "Elliott Wave" theory. B. Venu Gopal, B. Sivakumar

Wockhardt (Rs 448): We are unable to arrive at a convincing long-term Elliott Wave count for the stock.

From a short-term perspective, the outlook appears bearish. The stock could drop to Rs 360-370. This view would be confirmed on a close below the upward sloping trendline that connects the low at Rs 330 and Rs 373.4.

This line has a slope of Rs 0.34 per week and its current value is Rs 414.

Remain invested with a stop-loss at Rs 413. Fresh exposures may be avoided for the moment.

Orchid Chemicals (Rs 345): In Elliott Wave parlance, the stock appears to have completed Wave 1 at Rs 190 in December 2003 and Wave 2 at the low of Rs 113 in August 2004. The subsequent rally is part of Wave 3, which is not complete as yet.

The stock is presently in a corrective phase that appears almost complete.

A close past Rs 362 would indicate that the next leg of the uptrend is under way and the stock could move to the target zone of Rs 440-450. Remain invested with a stop-loss at Rs 305. Fresh exposures may also be considered with the same stop-loss.

Shall I hold or sell Selan Exploration bought at Rs 72 and MRO-Tek at Rs 78? V. Ravi

Selan Exploration (Rs 94): After completing a downward corrective phase at the low of Rs 43, the stock has commenced the next leg of the upward move.

There appears to be significant upside potential from prevailing levels. The stock could move to Rs 135-140 in the near-term. Have a stop-loss of Rs 87. Fresh exposures may be considered with the same stop-loss.

MRO Tek (Rs 81): The share price has been in a downtrend in the recent weeks. There are no signs of the completion of this downtrend. A close above Rs 85 would be an early indicator of the resumption of the long-term uptrend. On the other hand, a close below Rs 66 would impart prolonged weakness. Remain invested with a stop- loss at Rs 66. Fresh exposures may be avoided.

How does BASF look on the charts? Srinivasan Chockalingam

BASF India (Rs 242): The medium-term trend is positive and would remain so, as long as the stock holds above the support zone at Rs 225-230. Remain invested with a stop-loss at Rs 220. Consider fresh exposures on declines, with the same stop-loss. A close above Rs 260 would indicate that the stock is headed towards the next target zone of Rs 325-330.

Please let me have your views on Hindalco purchased at Rs 146.5 and Gujarat Ambuja Cements at Rs 90.5? Gnana, Muneer

Hindalco (Rs 224): Apart from Tata Steel, this is another stock that would qualify as one of our favourites from the metals space. The stock is in a major uptrend and could move to the immediate target zone at Rs 245-250. There is a strong support at Rs 200-205. A close below Rs 198 would result in a downward correction. Investors may have a stop-loss at Rs 198 for all long positions. Have a stop-loss at same level for exposures taken afresh. Those willing to wait for a while may find exit opportunity at Rs 325-330.

Gujarat Ambuja Cement (Rs 124): The outlook is positive and a move to Rs 145-150 appears likely. Stop-loss for existing long positions may be placed at Rs 100.Fresh exposures may also be considered on weakness, with the same stop-loss. The positive view would be negated only on a close below the long-term bearish trigger level at Rs 87.

What is outlook for Manugraph Industries brought at Rs 276? Raghunath

Manugraph Industries (Rs 290): The stock could move to Rs 335-340 in the near-term. Shareholders may remain invested with a stop-loss at Rs 250. Fresh exposures may also be considered with the same stop-loss. Have a trailing stop-loss in place once the stock moves beyond the target zone.

Please let me know the prospects of Bombay Dyeing. Krishna Parameshwar

Bombay Dyeing (Rs 881): The stock has seen an amazing run-up in price in recent months. There appears to be upside potential extending up to Rs 1,150-1,200. Remain invested with a stop-loss at Rs 700. Fresh exposures may be considered on weakness, with the same stop-loss.

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