Investors with a short-term perspective can sell the stock of Jindal Steel & Power at current levels. The stock registered a 52-week high at ₹238 in late August this year and encountered a key resistance at around ₹235.
Subsequently, the stock changed direction, triggered by negative divergence in the daily as well as the weekly price rate of change indicators.
Since then, the stock has been on a short-term downtrend. While trending down, it conclusively breached a vital support at ₹200 as well as the 50-day moving average on Monday and then formed a downward flag pattern, which is a continuation pattern.
On Thursday, the stock tumbled 6 per cent breaking this pattern and strengthened the downtrend. Besides, the stock trades well below the 21- and 50-day moving averages. The daily relative strength index (RSI) features in the bearish zone and the weekly RSI is hovering in the neutral region with a downward bias. Further, the daily price rate of change indicator is hovering in the negative territory, implying selling interest.
The short-term outlook is bearish for the stock. It can extend the down-move and reach the price targets of ₹157.5 and ₹154 in the forthcoming trading sessions. Traders can sell the stock with a stop-loss at ₹168.
The recommendations are based on technical analysis. There is a risk of loss in trading