I hold shares of Pidilite Industries bought at Rs 145. Should I book profit or hold at current levels?

Praveen Jain

Pidilite Industries (Rs 259.9): After registering an all-time high of Rs 278 in late February 2013, the stock has started to move sideways. The stock has been losing bullish momentum. It has formed a rising wedge pattern which acts as a bearish reversal in this scenario. The stock is testing key resistance at Rs 270. Both daily and weekly indicators are displaying negative divergence indicating a potential trend reversal on the cards. The stock has gained 20 per cent year to date. As you are sitting on huge gains it is advisable to book profits at this juncture and re-enter later.

A decline below the stock’s immediate support at Rs 250 will pull the stock down to Rs 230 or to Rs 210 in the medium-term. Subsequent important supports are at Rs 190 and Rs 180. Long-term investors can consider buying in declines with stop-loss at Rs 180.

On the other hand, strong breakout above Rs 270 can take the stock higher to Rs 300 in the medium-term.

Please give your outlook on MCX? Can I buy the stock now with a long term view?

Nithya

Multi Commodity Exchange of India (Rs 928.8): Multi Commodity Exchange of India (MCX) has completely retraced the up move formed during May and November 2012 from Rs 838 to Rs 1,613. Following an intermediate downtrend from November peak, the stock found support around Rs 830 in late March 2013.

The stock subsequently changed direction triggered by positive divergence in daily indicators. Last week, the stock has advanced 11 per cent with good volume.

Investors with long-term perspective can consider buying the stock in small quantities with stop-loss at Rs 830.

Alternatively, investors with low risk appetite can wait for a decisive break out from its immediate key resistance at Rs 1,025 and then buy the stock.

Strong rally above Rs 1,025 can take the stock higher to Rs 1,150 and Rs 1,200 band in the medium-term. Next significant long-term resistances are at Rs 1,300 and Rs 1,400 .

Conversely, failure to breach the Rs 1,025 level can see the stock moving sideways between Rs 830 and Rs 1,025 . However, it is hard to envisage where the next halt will be if the stock declines below Rs 830.

I have shares of Shasun Pharma bought at an average rate of Rs 80 . Kindly advise the medium and long term trend for this stock. .

R. Sathiyanarayanan

Shasun Pharmaceuticals (Rs 66.6): After forming a double top pattern, which is a bearish reversal pattern, the stock broke through its neck line at Rs 143 in late December 2012 and continued to trend downwards. The stock has been on an intermediate-term downtrend from its December 2012 peak of Rs 184. While trending down, the stock breached key long-term supports at Rs 120 and Rs 90.

However, the stock recently appears to have found support at its key base of Rs 60.

Though the stock's daily indicators are displaying positive divergence and the stock is hovering just above its key support, it is early to conclude whether the stock has reversed direction.

Long-tem investors can consider holding the stock with stop-loss at Rs 58 and exit in rallies at Rs 90 and Rs 100 band. The stock needs to decisively move above Rs 120 to alter its downtrend and take it higher to Rs 143 levels.

On the other hand, strong decline below Rs 60 will drag the stock down to Rs 50 and then to Rs 39 in the medium-term. Immediate key support is at Rs 60 and resistance at Rs 80.

I brought shares of Texmaco Infrastructure at Rs 40 . Please advice on the prospects of this stock.

K.K. Bhaskaran

Texmaco Infrastructure & Holdings (Rs 27.5): The stock has been consolidating sideways since early 2011 in a broad range of Rs 24 and Rs 40. After testing the upper boundary in October 2012, the stock began to trend downwards and continues this trend in the intermediate-term.

However, the stock is currently reversing higher from a key support at Rs 26.5. The stock needs to surpass Rs 30 for a medium-term up move to Rs 32.

To reverse its downtrend and take the stock northwards to Rs 37 or to Rs 40 in the medium-term, it has to conclusively rally above Rs 34. Investors can prolong their holdings with stop-loss at Rs 24.

An emphatic decline below this level will pull the stock down to Rs 20 levels in the medium-term. Conversely, strong break above Rs 40 will take the stock higher to Rs 50 in the long-term.

From its 52-week high of 179.5 in early January, Hanung Toys has been declining. Please give your technical analysis on the stock.

Raminder Singh

Hanung Toys & Textiles (Rs121.4): Yes, the stock has been trending downwards from its 52-week high. Nevertheless, taking support at around Rs 100 in late March 2013, the stock bounced back sharply and tested resistance at Rs 130.

Upward breakout of Rs 130 will take the stock higher to Rs 143 in the short to medium-term. But to alter the downtrend, the stock has to move above Rs 143 level. Next resistances are at Rs 160 and Rs 180 levels.

Investors with long-term horizon can consider holding the stock till the support of Rs 100 holds. Strong downward breach of Rs 100 can pull the stock down to Rs 84 in the medium-term.

Kindly give your long-term view on NTPC.

Yeruva Suneeta

NTPC (Rs 140.8): NTPC has been on a long-term downtrend from its December 2009 peak of Rs 241. Medium as well as short-term trends for the stock are also down.

But the stock is currently testing its key long-term support at Rs 140, from which it had reversed in May 2012. Strong downward breach of this support will reinforce its long-term downtrend and pull the stock down to Rs 128 and then to Rs 113 in the medium-term.

Immediate significant resistances for the stock are at Rs 148 and at Rs 155. Only a strong rally above Rs 155 will reverse the stock’s medium-term downtrend.

The stock can trend higher to Rs 165 and to Rs 175 in the medium-term.

comment COMMENT NOW