Comments
BL Research Bureau
Traders hunting for near-term opportunity can consider initiating new short positions in the stock of Bharat Forge .
The stock, which has been rallying since early April, appreciated from ₹210 levels and it recorded a three-month high of ₹385.7 towards the end of June. However, it failed to move beyond that level, and the price started to moderate. Following this, the stock breached the vital support of ₹330, thus forming a lower low in the daily chart for the first time in three months. Moreover, on the daily chart, a confirmed double-top pattern – an indication of bearish reversal – can be spotted. This could mean that the short-term trend has turned negative, and the likelihood of further depreciation is high.
Substantiating the bearish view, the daily relative strength index has been falling sharply since last week; it has slipped below the midpoint level of 50. Also, the moving average convergence divergence indicator on the daily chart, though in the positive territory, has turned the trajectory downwards. Considering the above factors, traders can sell the stock with a stop-loss at ₹330. The next support levels are at ₹310 and ₹300, which can the potential targets. According to the double-top pattern, the stock could even fall to ₹280.
Supports: ₹310 and ₹300
Resistances: ₹330 and ₹340
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
Comments
COMMENT NOW
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.