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

I have purchased LIC Housing shares at ₹335 and GIC Housing shares at ₹240. I can hold both for a period of six months. Kindly let me know the targets for both the stocks.

JH Krishnamurthy

LIC Housing Finance (₹470.4): From your buy price, the stock has gained 40 per cent. After encountering resistance at ₹500 in late January 2015, the stock has turned volatile and lost some of its bullish momentum. Indicators in the weekly chart are showing signs of weakness. Therefore, you can consider booking partial profits at this juncture and hold the rest with a stop-loss at ₹350 levels.

The long to intermediate-term uptrend, which commenced from the August 2014 support level of ₹155, remains intact.

This uptrend will continue as long as the stock trades above a significant long-term support band between ₹280 and ₹300. A strong fall below this band will alter the uptrend and drag the stock down to ₹250 and ₹200 in the long term. The stock has medium-term key support at ₹400 and if this support level holds, the stock can rally to ₹500 and then to ₹550 in the coming months. Long-term target for the stock is ₹600.

GIC Housing Finance (₹244.4): Following a sharp rally in early January 2015, the stock did a volte-face after recording a new high at ₹287 in mid-January. Since then, the stock has been in a short-term downtrend. Taking support at ₹225 the stock bounced back last week.

However, this rally is likely to be short-lived. Resumption of the downtrend can see the stock breaking its key support at ₹225 and decline to ₹200 and then to ₹180 in the medium term.

On the upside, the stock has significant resistance at ₹260; the inability to rally beyond this level will be cue for investors to book profits and exit the stock. An emphatic break out of ₹260 can push the stock northwards to ₹282 and ₹300 in the medium term. Significant support below ₹180 is pegged in the range between ₹150 and ₹160. Investors with a long-term perspective can hold the stock with a stop-loss at ₹150. Long-term uptrend will pose a threat on a decisive fall below this level.

Please give long term outlook on Capital first and Mirza international.

Rajeev Raj

Capital First (₹408.2): After taking support from the stock’s key long-term base zone between ₹120 and ₹130 in January 2014, the stock of Capital First started to trend upwards. Since then, the stock has been in an intermediate-term uptrend. The medium-term trend is also up for the stock.

However, the stock encountered a significant long-term resistance in the band between ₹420 and ₹440 this January and is finding difficulty in surpassing this band. The indicators in the weekly chart are showing negative divergence implying a potential trend reversal. Hence, investors sitting on profits can consider taking them off the table at this resistance band and re-entering at lower levels. However, a strong break-out of ₹440 will open up buying opportunity. The long-term targets on such a break are at ₹500 and ₹550 levels. Key supports are placed at ₹360 and ₹300.

But, a decisive fall below ₹275 will mar the stock’s intermediate-term uptrend and pull it down to ₹220 or ₹200 in the long term.

Mirza International (₹78.8): The stock broke out of a narrow trading range between ₹39 and ₹48 in early January 2015 and registered a new high at ₹88 in late January. Subsequently, the stock began to witness choppy movement. Currently, the stock faces a key resistance at the level of ₹85.

A break of this level can take the stock higher to ₹90 and then to the psychological resistance level of ₹100 in the medium term. Having said this, failure to decisively move above ₹85 can pull the stock down to ₹66 and then to ₹55 or ₹50 in the medium term.

Further fall below the key base zone between ₹48 and ₹50 will drag the stock down to ₹38 in the long term.

Send your queries to techtrail@thehindu.co.in

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