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We recommend a sell in the stock of Pidilite Industries from a short-term perspective. It is evident from the chats of the stock that after forming a double top pattern spanning between early May and early August this year, it decisively broke through the neck line at around Rs 262. The stock has been on a short-term downtrend since registering an all-time high at Rs 302 on July 19. While trending down it conclusively breached its 21 and 50-day moving averages in late July. Moreover, on Monday, the stock tumbled 3.8 per cent breaching its 200-day moving average and reinforcing the bearish momentum. The stock is hovering well below its 50 and 200-day moving averages. The daily relative strength index is featuring in the bearish zone and the weekly RSI has entered this zone from the neutral region. The daily moving average convergence divergence indicator is sloping down in the negative territory in line with the stock price. Weekly MACD has signalled a sell and started charting downwards. We are bearish on the stock from a short-term perspective. We expect its downtrend to continue and reach our price target of Rs 223.5 or Rs 219 in the forthcoming trading sessions. Traders with short-term perspective can sell the stock with stop-loss at Rs 238 level.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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