: SELL "Pin It")
We recommend a sell in the stock of India Cements from a short-term perspective. It is evident from the charts of the stock that it has been on a medium-term downtrend from its March peak of Rs 118. Following a corrective up move, the stock encountered resistance in the band between Rs 90 and Rs 93 in July and August this year. This resistance coincides with 38.2 per cent Fibonacci retracement level of the prior downtrend.
Triggered by negative divergence in daily moving average convergence divergence indicator, the stock continued to decline. On Wednesday, the stock fell by 4.5 per cent, breaching its short-term uptrendline as well as moving average compression (21-, 50-, 200-day moving average) around Rs 84.
The daily MACD has signalled a sell and is likely to enter negative territory implying downward momentum. Both daily and weekly price rate of change indicators are featuring in the negative terrain indicating selling interest. We are bearish on the stock from a short-term perspective. We expect its decline to prolong and reach our price target of Rs 78.5 or Rs 76 in the forthcoming trading sessions. Traders with short-term perspective can consider selling the stock with stop-loss at Rs 83.5.
Keywords: India Cements, short-term perspective, sell, Stocks, Recommendations, Today's Pick, Technical analysis
Comments:
From the chart it's apparent that the stock closed at Rs.80 yesterday and your first target is Rs.78.50. Stop loss is at Rs.83.50. Why on earth should I take a trade that offers a risk reward of 1:1. Makes little sense. Even assuming your second target of Rs.76 is hit, the risk reward is little over 1:1. Just not acceptable by any yardstick.
Request Business Line to come with more meaningful analysis and trading calls. My guess is that these calls are from a person who has not actually traded with his own money.
If someone has trading experience, calls such as these would never be featured. Also, the tools used to justify the call (like MACD) works well in a trending market. This stock has been rangebound in the past few weeks and it's wrong choice of tools.
My read is that India Cements would get back to the upper end of the trading range at Rs.89.
Regards
Vijaya
Mr. vijaya is right, this analysis is completely wrong, instead of
short, he should have advised long, we could have made hand-full of
profit
kindly advise with better analysis
looking forward for sure shot analysis
rgds
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