Reliance Industries (Rs 1064.9)

After hovering around Rs 1080, RIL failed to gain conclusively and reversed lower last week. It managed to finish the week with a marginal gain of Rs 6.6. The stock continues to test its short-term resistance zone between Rs 1060 and Rs 1080.

Fresh long position is recommended only if the stock decisively moves above Rs 1080, in which case the target is Rs 1120. Key resistance above Rs 1120 is at Rs 1140.

Any decline can find support in the Rs 1035-1050 zone where its 200 and 50-day moving averages are placed. An emphatic dive below Rs 1030 can pull the stock lower to Rs 1010 and then to Rs 980. In the medium-term the stock continues to trade in the broad range between Rs 900 and Rs 1200.

State Bank of India (Rs 2599.8)

The stock reversed lower encountering resistance at Rs 2850 last Monday. It thereafter tumbled 7 per cent accompanied with good volumes over the week. While trending down, the stock breached its key near-term support around Rs 2700 and its 200-day moving average poised at Rs 2664.

The stock has been on a medium-term downtrend from early November. It has the potential to decline to its next key medium-term support at Rs 2500.

Traders can initiate short position with a stop-loss at Rs 2655 for a downside target of Rs 2500. Subsequent supports below this level are at Rs 2400 and 2250. The resistances for the stock are at Rs 2712 and Rs 2850.

Tata Steel (Rs 660.9)

Testing the key resistance band between Rs 680 and Rs 700, the stock reversed downwards last week by declining 2.6 per cent.

It has formed a bearish engulfing candlestick pattern, which is a bearish reversal pattern in week chart. This pattern coupled with key resistance indicates short-term reversal.

Traders can consider initiating short positions with stop-loss at Rs 680. Downside targets of the stock are Rs 640 and Rs 620. Medium-term support and resistance for the stock are pegged at Rs 600 and Rs 700 respectively.

The stock remains in a medium-term uptrend as long as it trades above Rs 575. A fall below this level will mitigate the uptrend.

Infosys Technologies (Rs 3366.5)

The stock gradually moved higher in the first four trading sessions and on Friday it marked an all-time high at Rs 3493 before plunging 3 per cent. For the week, the stock fell by Rs 78 or Rs 2.3 per cent. However, short-term trend is up for the stock from November-2010 trough. As long as the stock trades above Rs 3250, the uptrend stays in place and it can move sideways.

Key supports for the stock are at Rs 3329 and Rs 3184. Resistances are pegged at Rs 3445 and Rs 3493

Medium-term trend is up for the stock and investors can stay invested with stop-loss at Rs 2980. — Yoganand D.

(This article was published in the Business Line print edition dated January 9, 2011)
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