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Here are answers to readers’ queries on the performance of their stock holdings.
I am holding stocks of BEML and NBCC purchased at lower levels. What is the medium and long term view and the key levels to watch out for on downside. At what levels can I buy as both have declined recently.
Giri Raj
BEML (₹1,224.8): The stock of BEML found support at its multi-year low at ₹126 in August 2013. Since then, it has been on a long-term uptrend, forming higher peaks and troughs.
While trending up, the stock broke through many key resistances and eventually met with a significant long-term resistance at ₹1,600 in July this year. After recording a multi-year high at ₹1,609, the stock changed direction and has been on a medium-term downtrend from this July. On the other hand, important base in the range between ₹1,150 and ₹1,200 is providing support to the stock. The stock’s ongoing downtrend is getting stronger. Therefore, you could wait for a strong break of the immediate resistance at ₹1,300 to start buying. But a decisive fall below the key base zone between ₹1,150 and ₹1,200 will intensify the downtrend and drag the stock down to ₹1,000 and then to the next long-term base range of ₹830 and ₹870.
Such a fall can give a good opportunity for averaging the stock and accumulating it while maintaining a long-term stop-loss at ₹790. Long-term targets are ₹1,450 and ₹1,600. Only an emphatic break-out of ₹1,600 will pave way for an upmove to ₹1,800 in the long run.
NBCC (₹1,015.9): The stock of National Buildings Construction Corporation (NBCC) is in an uptrend across time-frames — long, medium and short term. After registering an all-time high at ₹1,214 in August 2015, the stock plunged 33 per cent to a low of ₹810 in that month.
Nevertheless, the stock bounced up smartly and is once again trending upwards. The stock now faces a key hurdle at around ₹1,050, which needs to be breached to continue its ongoing rally to ₹1,150 and ₹1,214 levels in the short to medium term. But a downward reversal from the resistance level of ₹1,050 can drag the stock down to ₹900 initially and then to ₹800 in the medium term. Key support to watch below ₹800 is at ₹700.
As long as the stock trades above the trend-deciding level of ₹650, the long-term uptrend remains in place. Investors with a long-term horizon can stay invested with a stop-loss at ₹630.
A strong rally beyond ₹1,200 can take the stock northwards to ₹1,400 in the long term.
What is your view on the long-term prospects of Union Bank of India.
Swathy R
Union Bank of India (₹175.6): The significant long-term resistance at ₹250 held the stock of Union Bank of India from further rallies during June 2014 and January 2015. Since this January, the overall trend for the stock is down. From this August peak of ₹222, the stock has been on a short-term downtrend. Recently, it encountered a key resistance at ₹190 and appears to be continuing its downtrend.
A fall below the immediate support level of ₹170 can pull the stock down to ₹155 in the short term. A further fall will drag the stock down to ₹135. Key resistances above ₹190 are at ₹210 and ₹250 levels. Only a conclusive breakthrough of the resistance at ₹250 will strengthen the bullish momentum and take the stock upwards to ₹290 or ₹300 in the long term.
Send your queries to techtrail@thehindu.co.in
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