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Investors with a short-term perspective can sell the stock of Ashok Leyland at current levels. After taking support at ₹43 in mid-December 2014, the stock resumed its uptrend and went on to mark an all-time high at ₹69 in late January 2015. Triggered by negative divergence in the daily indicator and formation of a bearish engulfing candlestick pattern, the stock changed direction. Since then, it has been on a short-term downtrend. On Monday, the stock tumbled 5.5 per cent breaking through a key support around ₹60. The stock has also breached its 21-day moving average. Further fall is imminent on the charts and the stock can extend its short-term downtrend in the upcoming sessions. The daily relative strength index is on the brink of entering the bearish zone. The daily price rate of change oscillator features in the negative territory implying selling interest. Traders can sell the stock with a stop-loss ₹58.8. Targets are ₹55 and ₹54 levels.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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