The Hindu Business Line : Reliance (Rs 2,028.6)

RIL failed to rally above the resistance at Rs 2,384 indicated in our edition dated June 14, 2009, and the third wave of the down-move from Rs 2,490 dragged the stock to our medium-term target of Rs 1,935. It is important to note that RIL has filled the gap formed after the Lok Sabha election results thus leading to the possibility that it was an exhaustion gap that signalled the end of the up-trend from March low of Rs 1,118. Key medium-term support is at Rs 1,900. If this level is breached, a decline to Rs 1,700 or Rs 1,520 is possible.

There can be a bounce to Rs 2,120 or Rs 2,267 in the short-term. Reversal from the first resistance would be a cue for short-term traders to short the stock. Supports for the short-term are Rs 1,900 and Rs 1,778.

State Bank of India (Rs 1,748.9)

The down-move from June 3 peak in SBI halted at Rs 1,612 and the stock has been meandering sideways ever since. We retain a negative medium-term view for the stock. The current sideways move appears to be the second wave of a medium-term downtrend. The targets for the third wave down are Rs 1,559 and Rs 1,436. The 200-day moving average poised around Rs 1,400 is a likely medium term target once the stock declines below Rs 1,600. Key short-term resistances for the stock are at Rs 1,780 and Rs 1,815. Failure to move above the first resistance will imply an impending down-move to Rs 1,612 or Rs 1,560. A strong close above Rs 1,815 will make the short-term view positive.

Tata Steel (Rs 387.9)

Tata Steel moved sideways in the range between Rs 380 and Rs 420 last week. As indicated earlier, the stock has key medium-term resistance around Rs 460. That the stock was unable to record an emphatic weekly close above this level implies that it can slide down towards Rs 320 or Rs 280 over the medium-term. A strong weekly close above Rs 460 is required to make the medium-term view positive again.

Tata Steel can be confined to the band between Rs 380 and Rs 420 over the short-term. Decline below Rs 380 will drag the stock lower to Rs 365 and Rs 340. Resistances for the week would be at Rs 427 and Rs 455.

Infosys (Rs 1,826.7)

Infosys oscillated in the range between Rs 1,700 and Rs 1,800 in the first four sessions of the week before surging on Friday to close at Rs 1,826. The stock faces key intermediate resistance in the zone between Rs 1,850 and Rs 1,900. A downward reversal from this zone can make the stock decline below Rs 1,400 over the medium-term. Conversely a strong close above Rs 1,900 will pave the way for a rally towards the stock’s all-time high again.

Short-term targets for the stock are Rs 1,850 and Rs 2,000. Supports for the week would be at Rs 1,740 and Rs 1,670.

ONGC (Rs 1,040.9)

The 10 per cent decline in the third week of June dragged ONGC below the key intermediate resistance at Rs 1,100. It needs to record a weekly close above this level to mitigate the negative medium-term view. Medium-term supports for the stock are Rs 1,000 and Rs 850. The stock is attempting to move higher from the first support. Short-term investors can buy with a stop at Rs 960. ONGC can move on to Rs 1,132 or Rs 1,220 over the short-term. Short-term support on a decline below Rs 970 is at Rs 917. — Lokeshwarri S.K.

More Stories on : Technical Analysis | Stocks

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