Technical Analysis

Pivotals: Reliance Industries (Rs 840.2)

YOGANAND D. | Updated on September 28, 2013 Published on September 28, 2013

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Last week, the stock failed to surpass its key resistance at Rs 890 and tumbled 4.8 per cent. Its short-term uptrend is under threat now. The stock breached its 21 and 50-day moving averages decisively and is now testing its 200-day moving average. Short-term traders can initiate fresh short positions with stop-loss at Rs 858. Targets are at the Rs 800 and Rs 810 support band. A strong decline below this support band will pave the way for a down move to Rs 770 and Rs 780 zone.

The stock has important resistance at Rs 860. Conclusive rally beyond this resistance will negate our bearish view and take the stock higher to Rs 890. We reaffirm that only a decisive breakthrough of Rs 890 will take the stock higher to Rs 920. However, the medium-term trend remains sideways in a wide range between Rs 770 and Rs 920.

State Bank of India (Rs 1,641.3)

The stock lost 6 per cent in the previous week, diminishing its bullish momentum. The stock is now hovering just above its important support at Rs 1,600. A decisive fall below this support will pull the stock down to its next key support in the band between Rs 1,500 and Rs 1,510 in the near-term. Subsequent key support is pegged at around Rs 1,400. Short-term traders can initiate fresh short positions only if the stock slips below Rs 1,600 with same stop-loss.

The stock has key resistance at Rs 1,725 and Rs 1,800 levels. Only an emphatic rally above Rs 1,800 will reinforce bullish momentum and push the stock higher to Rs 1,900. Next resistance is at Rs 2,000.

Infosys (Rs 3,006.4)

Infosys prolonged its sideways consolidation movement in the band between Rs 2,950 and Rs 3,130. A conclusive tumble below Rs 2,950 will be the cue for initiating fresh short positions with the same as stop-loss. Targets will be Rs 2,900 and then Rs 2,800.

But an upward breakout of Rs 3,130 will strengthen the stock’s bullish momentum and accelerate the stock upwards to Rs 3,225 levels over the medium-term. The stock’s medium-term trend will stay up as long as it trades above Rs 2,600 levels.

Tata Steel (Rs 287.8)

In the previous week, the stock tanked 4 per cent, reversing down from the significant resistance at Rs 300. The stock’s daily and weekly relative strength indices are inching lower in the neutral region towards the bearish zone. Its short-term uptrend will be under threat only if the stock tumbles below Rs 260 levels. Immediate supports are pegged at Rs 280 and Rs 270 levels. Short-term traders should tread with caution in the ensuing week.

A strong jump above Rs 300 can take the stock higher to Rs 310 and then to Rs 320 where its 200-day moving average is poised. Subsequent key resistance is at Rs 340 levels.

Published on September 28, 2013
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