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We recommend a sell in the stock of Syndicate Bank from a short-term horizon. It is apparent from the charts of the stock that after following a medium-term uptrend, the stock encountered key resistance at Rs 120 in mid-February and again in mid-March this year. Triggered by negative divergence in daily moving average convergence divergence indicator, the stock changed its trend. Since then, the stock has been on a medium-term downtrend.
In late April this year, the stock conclusively penetrated its key support at Rs 105, and later on, its 200-day moving average. Last week, the stock breached its important support at Rs 91. It is hovering well below its 50- and 200-day moving averages. On Tuesday, it fell 3.4 per cent reinforcing its medium-term downtrend. The daily and weekly relative strength index are featuring in the bearish zone. Both daily as well as weekly MACD are declining in the negative territory implying downward momentum. Our short-term outlook on the stock is bearish. We expect its decline to continue and reach our price target of Rs 83.5 or Rs 80.5 in the approaching trading sessions. Traders with short-term perspective can consider selling the stock with stop-loss at Rs 88.5.
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