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Investors with a short-term perspective can sell the stock of Tata Power at current levels. On Tuesday, the stock tumbled almost 4 per cent decisively breaking an immediate support at ₹81. This has strengthened the intermediate-term downtrend that has been in place from the June 2014 peak of ₹115. The short-term trend is also down for the stock. In early December, the stock conclusively breached its moving average compression around ₹90.
The stock is hovering well below its 50- and 200-day moving averages. A key resistance at ₹84 limited the stock’s rally over the past three weeks. The indicators and oscillators on the daily chart have entered the bearish zone. Overall, the short-term outlook is bearish for Tata Power. The stock can continue to decline and reach the price target of ₹78.5 and then to ₹74.5 in the coming sessions. Sell the stock while maintaining a stop-loss at ₹81.5.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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