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SBI (₹199.9)
The short-term uptrend in SBI is gaining momentum. The 4 per cent rally witnessed last week has taken the stock above the key resistance at ₹198. The stock price has been facing resistance at ₹198 since February. Earlier this month, the fall from ₹198 levels had found support at ₹180. The strong reversal from ₹180 breaking above ₹198 signals that the short-term uptrend has resumed. The region between ₹196 and ₹191 is a good short-term support zone that can limit the downside in this stock. Short-term traders can go long with a stop-loss at ₹193 for the target of ₹210. Intermediate dips to ₹196 can be used to accumulate longs. As the stock move up to ₹206, investors should revise the stop-loss higher to ₹202. Immediate resistance is between ₹203 and ₹205, which is likely to be tested. A strong break above ₹205 can take the stock higher to ₹212 in the coming week. Inability to break above ₹212 may trigger a corrective fall to ₹205 or even ₹200 thereafter.
ITC (₹325.7)
ITC remains range-bound between ₹319-₹338 for the fifth consecutive week. It made a high of ₹338.4 but corrected later to close about a per cent down for the week. Within the range, it can trade with a negative bias. The possibility is high for the stock price to move down to test ₹319 — the lower end of the range. A reversal from there can take the stock higher to ₹335 and ₹338 once again. Short-term traders with high risk appetite can go ‘long’ on such a reversal from ₹319 with a stop-loss at ₹310 and aiming for a target of ₹335. The 55-day moving average at ₹317 would be an important short-term support. The stock price will come under pressure if it declines below the support price of ₹310. On the other hand, ₹338-340 can act as a key resistance zone. A strong break above the level of ₹340 will take the stock higher to ₹360. Investors can continue to hold the long position and accumulate on dips near ₹320. Retain the stop-loss at ₹310 for the target of ₹357.
Infosys (₹1,213.8)
Infosys opened the week with a huge gap-up as expected following the strong results. But the stock failed to get strong follow-through buying and reversed lower from its high of ₹1,267.9. This reversal is significant as it has happened from an important long-term trend resistance. So the price action in the coming weeks will need a close watch that would give a cue on the next trend for the stock. On the charts, there is room left for Infosys to extend its fall further in the near term. The 21-day moving average support is at ₹1,204 which can be tested this week. A break below this support can drag it further lower to ₹1,998 and ₹1,995 – an important support zone. If the stock manages to move higher, a further appreciation to ₹1,250 is possible. But if it continues to decline below ₹1,995, it can target ₹1,150. However, the downside pressure will ease only on a decisive break above ₹1,270. Such a break can take Infosys higher to ₹1,300 or even higher thereafter.
RIL (₹1,038.7)
Contrary to our expectation of a rise to ₹1,080-₹1,090 levels (mentioned in this column last week), RIL corrected from its high of ₹1,070 in the past week. It closed 2.5 per cent lower for the week. There is support near current levels at ₹1,035 which can hold — as the positive fourth quarter results may aid the stock rebound from the current levels. Such a reversal can take RIL higher to ₹1,065 and ₹1,070 once again. A strong break above ₹1,070 will boost the bullish momentum and take the stock further to ₹1,080 initially and then to ₹1,100 and ₹1,110 thereafter. On the charts, there is a bullish bias with the possibility of RIL rallying to ₹1,100 and ₹1,110 price levels in the coming weeks. Investors with a short-term perspective can go long, if the stock moves higher from ₹1,035 with a stop-loss at ₹1,010 for the target of ₹1,100. On the other hand, if RIL declines below the immediate support at ₹1,035, which is less likely, it can fall to ₹1,020 and ₹1,015.
Tata Steel (₹353.8)
Extending the upmove, Tata Steel surged over 6 per cent last week. However, the uptrend that began in February is facing resistance around ₹360, as expected. The stock faced resistance at ₹364 in the last two consecutive trading days, signalling that a corrective fall could be on the cards. Immediate support is at ₹352. A break below it can take Tata Steel lower to ₹343. If the stock declines below ₹343 decisively, then the fall can extend to ₹335 or even ₹333. The region between ₹355 and ₹357.5 — the 100- and 200-week moving averages respectively — is an important resistance zone. A weekly close above this zone will be the first sign of the uptrend resuming. A subsequent breach above ₹364 will confirm and open doors for the next target of ₹387. Investors can stay on the sidelines and make use of dips to go long near ₹345. Accumulate if the stock extends its fall to ₹335. Keep the stop-loss at ₹315 for the target of ₹385.
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