Technical Analysis

Asian Paints in a strong uptrend

Yoganand D | Updated on January 13, 2019 Published on January 13, 2019

The long-term trend will be up as long as the stock trades above ₹1,100

Here are answers to readers’ queries on the performance of their stock holdings.

I have bought shares of Asian Paints at ₹ 1365 and Tata Elxsi at ₹990. Kindly indicate supports and resistances

TVS Prakash Rao

Asian Paints (₹1,402.2): The stock of Asian Paints continues to trend up since taking support at ₹1,120 in October 2018. It has been on a medium-term uptrend since then. Also, the short-term trend is up for the stock. It trades well above its 50- as well as 200-day moving averages. But the stock now tests a key resistance in the ₹1,400 and ₹1,425 band. A decisive break above this barrier is required to strengthen the uptrend and take the stock up to ₹1,470 and ₹1,500 levels.

 

 

Since taking support at ₹850 in December 2016, the stock has been on a long-term uptrend.

As long as it trades above the significant long-term support level of ₹1,100 the long-term trend will remain up.

Investors with a long-term perspective can remain invested with a revised fixed stop-loss at ₹1,070.

Investors with a medium-term perspective can make use of declines to accumulate the stock. A further rally above ₹1,500 can take the stock up to ₹1,550 over the long run. Key supports to note are placed at ₹1,300 and ₹1,200 levels.

A decisive fall below these supports can drag the stock down to ₹1,100 levels over the medium term. A further fall below ₹1,100 can see the stock find support at ₹1,050 and ₹1,000 levels.

Tata Elxsi (₹961.6): After a sharp fall in September and early October 2018, the stock of Tata Elxsi found support at ₹950 in late October.

The stock has been on a sideways consolidation phase in the band between ₹950 and ₹1,100 since then. It currently tests a key support as well as the lower boundary at ₹950. The medium-term trend is down for the stock.

A strong fall below ₹950 will strengthen the downtrend and drag the stock down to ₹900 and then to ₹850 in the short to medium term.

 

 

Key resistances are placed at ₹1,000 and ₹1,100. A strong break above ₹1,250 is needed to alter the medium-term downtrend and take the stock higher to ₹1,350 and ₹1,400 levels.

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Published on January 13, 2019
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