We recommend a sell in the stock of Excel Crop Care from a short-term perspective. It is apparent from the charts of the stock that after bottoming out in the band between Rs 95 and Rs 100 in June 2012, it was trending northwards until its mid-November peak of Rs 242. However, the stock changed its direction subsequently, triggered by negative divergence in daily relative strength index and daily price rate of change indicator.

The stock's key support at Rs 200 was providing cushion and it was moving sideways. But, a strong breach of this support on Wednesday, with the stock tumbling almost 7 per cent, has reinforced bearish momentum on the stock. It is trading well below its 21- and 50-day moving averages.

The daily RSI is featuring in the bearish zone and weekly RSI is declining in the neutral region towards the bearish zone. The daily moving average convergence divergence indicator is sloping down in line with the stock price implying downward momentum. Both daily and weekly price rate of change indicators are hovering in the negative territory indicating selling interest. We are bearish on the stock from a short-term perspective. We expect its downfall to continue and reach our price target of Rs 180.5 or Rs 176.5 in the forthcoming trading sessions. Traders with short-term perspective can consider selling the stock with stop-loss at Rs 192 levels.

(This article was published on January 23, 2013)
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