The uptrend in Thomas Cook from the February low of ₹72.6 has found strong resistance at ₹107.
The stock has failed to breach this level despite several unsuccessful attempts in the last three weeks. The sharp 3 per cent fall on Tuesday has decisively broken the support at ₹101.7. This suggests that a corrective fall is on the cards.
The short-term outlook has turned bearish and opens an opportunity for traders to take short-positions. Immediate resistances are at ₹100.4 and ₹101.7. Below these resistances, the stock can fall to ₹97 and ₹95 in the coming days.
Traders with a short-term perspective can go short with a stop-loss at ₹101.2 for a target of ₹97.2.
Only a strong break above ₹101.7 will give some relief for the stock.
However, it needs a decisive break and should close above ₹107 to negate the bearish view.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
The stock recommendation headline for Thomas Cook incorrectly said Buy. The error is regretted.