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Investors with a short-term perspective can consider selling the stock of Berger Paints India at current levels. Since taking support at around ₹160 in March 2016, the stock has been on a medium-term uptrend.
This uptrend could be in place as long as the stock trades above the key medium-term support at ₹200. But the shortterm uptrend that commenced in late June is under threat as the stock encountered a key resistance at around ₹250 last week and started to decline.
This downward reversal is backed by negative divergence in the daily relative strength index and the price rate of change indicator.
On Wednesday, the stock fell 2.8 per cent, breaching its 21- DMA and an immediate support at ₹232. The daily moving average convergence divergence indicator has signalled a sell. The short-term view is bearish for the stock. Traders can sell the stock with a stoploss at ₹235. Targets are ₹220 and ₹213.
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