Short-term outlook is bullish for SBI (₹290.3)
SBI fell over 3 per cent in the initial part of last week. However, the stock managed to claw back from the low of ₹273.5, recovering all the losses and closed 2.6 per cent higher. This leaves the outlook bullish. The indicators on the charts are also positive. The 21-day moving average has crossed the 200-day moving average. This is a positive signal, indicating that the downside could be limited. Immediate resistance is in the ₹292-293 region. Inability to breach this hurdle can drag SBI lower to ₹280 and ₹275 again. The stock can then remain range-bound in the band between ₹275 and ₹293 for some time. But a strong break above ₹293 will take SBI higher to ₹311. A further decisive break above ₹311 will then increase the likelihood of the stock extending its upmove to ₹320 and ₹322. Medium-term traders who have taken long positions last week at ₹282 and ₹279 can hold them. Retain the stop-loss at ₹269 for the target of ₹308. Revise the stop-loss higher to ₹287 as soon as the stock moves up to the level of ₹294.
Near-term view is unclear for ITC (₹276.2)
ITC was stuck in a narrow range between ₹273 and ₹279 last week. The near-term view continues to remain mixed. The support at ₹273 is holding well. The stock will, however, come under renewed pressure only if it breaks below the crucial support level of ₹271. Such a break can drag the stock lower to ₹265 or even ₹260 over the short term. On the other hand, the 200-day moving average at ₹279 is a key resistance to watch. The downside pressure would ease if ITC manages to breach this hurdle. A strong break above ₹279 will take the stock initially higher to ₹288 or ₹290. A pull-back from the ₹288-290 resistance region can take the stock lower to ₹280 and ₹275 again. But a strong break above ₹290 will turn the outlook to positive and take ITC to ₹297 and ₹300. Traders holding long positions at ₹283 and ₹280 should remain cautious. Retain the stop-loss at ₹273 for the target of ₹298. Revise the stop-loss higher to ₹285 as soon as the stock moves up to ₹289.
Infosys hovers above a crucial support (₹650.4)
Infosys fell last week, but at a slower pace. The stock was down 1.7 per cent for the week. A key near-term support is at ₹636 — the 200-day moving average. Whether Infosys breaks below this support or not will determine the direction of the next move. A decisive break below ₹636 will take the stock initially lower to ₹631 — the 38.2 per cent Fibonacci retracement support level. If Infosys manages to reverse higher either from ₹636 or ₹631, an up-move to ₹675 and ₹680 is possible in the near term. Cluster of resistances are poised in between ₹685 and ₹700. The outlook will turn positive for the stock only if it manages breach the psychological level of ₹700. But such a strong up-move looks less probable now. On the other hand, if Infosys breaks below the Fibonacci retracement support level of ₹631, the downside pressure would increase. In such a scenario, the downtrend that has been in place since October will remain intact. It will then increase the likelihood of the stock extending its fall to the levels of ₹600 and ₹590.
Key resistance ahead for RIL (₹1,127.5)
RIL has been moving higher over the last three consecutive weeks. The stock was up 3 per cent last week and surged about 8 per cent in the last three weeks. Immediate resistances are at ₹1,137 and ₹1,144, which are likely to be tested in the coming days. A strong break above ₹1,144 will take RIL initially higher to ₹1,162. A further decisive break above ₹1,162 will then boost the bullish momentum. Such a break will then increase the likelihood of the rally extending to ₹1,200 and ₹1,210 thereafter. Short-term traders with high-risk appetite can go long dips at ₹1,115 and ₹1,105. Stop-loss can be placed at ₹1,075 for the target of ₹1,195. Revise the stop-loss higher to ₹1,130 as soon as the stock moves up to ₹1,155. On the other hand, if RIL fails to breach ₹1,144 and reverses lower, it can fall to ₹1,115 and ₹1,100. A strong break below ₹1,100 will then increase the possibility of the fall extending towards ₹1,075 and ₹1,050 thereafter. In such a scenario, RIL can remain range-bound between ₹1,050 and ₹1,150 for some time.
Supports to limit fall in Tata Steel (₹574.1)
Tata Steel surged over 6 per cent intra-week and made a high of ₹610. But it failed to sustain higher and fell sharply giving back almost all the gains. The near-term outlook is mixed. Though a further fall cannot be ruled out, the presence of a series of supports may restrict the pace of the downmove from the current levels. Immediate support is at ₹570. Next significant support is in the ₹565-555 band. The stock will come under renewed pressure only if it declines decisively below ₹555. The next targets are ₹540 and ₹535. However, such a strong fall breaking below ₹555 looks less likely at the moment. An upward reversal from this support zone will take the stock higher to ₹585 and ₹600 levels again. Key resistance is in the ₹590-600 region. A strong break and a decisive close above ₹600 is needed for Tata Steel to gain fresh momentum. Such a break will bring fresh buying interest into the market and increase the likelihood of the stock rallying towards ₹625 and ₹640 thereafter.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.