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We recommend a ‘sell' in Punjab National Bank from a short-term trading perspective. The stock faces strong resistance between Rs 1,110 and Rs 1,130. Presence of the 50-day moving average at this zone also adds to the significance of this resistance. The stock is reversing lower from the recent peak at Rs 1,119. Since the medium-term trend in the stock is also down, the path of least resistance is southward.
Rate of change oscillator in the daily chart has cut below the zero line to move in to bearish zone. Relative strength index in the daily chart is also dipping, albeit in the neutral zone.
Oscillators in the weekly chart are extremely weak and moving sideways in the oversold region. The stock can move down to Rs 1,050 or Rs 1,030 in the days ahead. Traders can therefore sell the stock with stop loss at Rs 1,080.
The analysis and opinion expressed in these columns are based on the technical analysis of the past price behaviour. The stop-loss level provided with the recommendation is important. The original view would stand negated if the stop-loss level is breached. There is a risk of loss in trading
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