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We recommend a sell in the stock of Pantaloon Retail from a short-term perspective.It is seen from the charts of the stock that ever since peaking out at Rs 527 in October 2010, the stock has been on a long-term downtrend. Following a short-term corrective up move, the stock encountered key resistance at Rs 200 this February and resumed its downtrend. Since then, the stock has been on a short-term downtrend. The stock breached its 21- and 50-day moving averages in early March and is trading well below them. On Monday, the stock penetrated its significant medium-term support at around Rs 150 by declining 4.7 per cent. Both daily and weekly relative strength indices are featuring in the bearish zone. The daily and weekly moving average convergence divergence indicators are hovering in the negative terrain implying downward momentum.
The stock's daily and weekly price rate of change indicators too are in the negative zone indicating selling interest. Both intermediate and short-term trends of the stock are down and intact. We are bearish on the stock from a short-term perspective. We expect its decline to continue and reach our price target of Rs 140 or Rs 135.5 in the forthcoming trading sessions. Traders with short-term perspective can consider selling the stock with stop-loss at Rs 149.
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