Technical Analysis

Reliance Industries (Rs 780.3)

Yoganand D. | Updated on April 06, 2013 Published on April 06, 2013





The stock was volatile and formed a doji candlestick pattern indicating neutral stance in the weekly charts. It continues to trade above significant support levels at Rs 760. Further, the stock is hovering at a trend-deciding level and therefore short-term traders should tread with caution in the upcoming week.

We restate our prior stance with that a strong breach of Rs 760 will pull the stock down to Rs 740 levels. Key supports below this are placed at Rs 710 and Rs 690.

As long as the stock trades below Rs 880, its short-term downtrend remains in place.

Only a strong rally above this level will reverse the downtrend and push the stock higher to Rs 900-920 levels. Significant resistances for the week ahead are at Rs 800, Rs 840 and Rs 860.

State Bank of India (Rs 2,056.3)

The stock has been on a short to medium-term downtrend since peaking out in January this year. It is trading well below its 50 and 200-day moving averages. The stock is still testing key trend deciding zone between Rs 2,025 and Rs 2,075.

A strong decline below this zone is required to reinforce bearish momentum and drag the stock down to Rs 1,950 and then to Rs 1,900 in the medium-term. Traders with a short-term perspective should initiate fresh short positions only if the stock declines below the aforementioned zone with stop-loss at Rs 2,025 levels.

On the upside, the stock has key resistance in the range between Rs 2,200 and Rs 2,230.

Next resistance is at Rs 2,273. The stock needs to conclusively rally above Rs 2,350 to alter its short-term downtrend and push higher to Rs 2,450.

Infosys (Rs 2,863.8)

The stock gave away its initial gains and closed Rs 26 lower in the previous week. It is currently testing key support at Rs 2,850. A strong decline below this will drag the stock down to Rs 2,800 or lower to Rs 2,750 in the short-term.

In that scenario, traders can initiate fresh short position with stop-loss at Rs 2,850.

Significant immediate resistances are at Rs 2,950 and Rs 3,000.

Medium-term trend is up and investors with medium-term perspective can prolong their long holdings with stop-loss at Rs 2,500. Strong upward breakthrough of Rs 3,000 will take the stock northwards to Rs 3,100 and to Rs 3,200 in the medium-term.

Tata Steel (Rs 308.5)

Tata Steel was choppy and ended one per cent lower last week. It is hovering well below its 50 and 200-day moving averages. However, it is also hovering just above its significant long-term support at Rs 300.

Short-term traders should continue to tread with caution as long as the stock’s long-term support holds.

An emphatic decline below Rs 300 will drag the stock down to Rs 270 in the medium-term.

On the other hand, the stock needs to decisively rally above Rs 390 to alter its medium-term downtrend and push it northwards to Rs 420.

Important resistances to watch are pegged at Rs 335, Rs 350 and Rs 365 levels.

Published on April 06, 2013
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