Ingersoll Rand (₹1,414.2)
Cracks a critical resistance
The stock of Ingersoll Rand witnessed two phases of consolidation since the beginning of its latest leg of rally that started in April last year from about ₹680, the latest being the range of ₹1,100-₹1,320. The scrip broke this range on the upside last week. Therefore, going ahead, the stock is expected to establish a fresh leg of uptrend.
It has the potential to rally to ₹1,600, although with a minor pause or a correction from around ₹1,500. But the price could moderate to ₹1,320 before going up. Hence, traders can buy the stock at current levels and on a decline to ₹1,325 so that the average price comes at around ₹1,370. Initially, place a stop-loss at ₹1,260 and shift it to ₹1,400 when the stock rallies past ₹1,500. Liquidate 75 per cent of the positions at ₹1,570 and the leftover at ₹1,600.
Hitachi Energy India (₹3,030.8)
Sees fresh breakout
Although the long-term trend of the stock of Hitachi Energy India is bullish, it was struggling to breach the hurdle at ₹2,800 since last year October. However, the stock did not fall either since ₹2,300 and ₹2,400 provided solid support.
After two failed attempts, the bulls successfully lifted the stock above ₹2,800 last week. This is likely to induce more upward momentum and see a rise to. Consequently, the stock will most probably appreciate to ₹3,440 and ₹3,615 over the medium term. Also, there are high chances for the scrip to dip to ₹2,850 before rallying. So, one can go long now and add more longs when the price softens to ₹2,850. Thus, the average price will be around ₹2,940. Keep stop-loss at ₹2,640. When the stock touches ₹3,440, exit half of the longs and shift stop-loss to ₹3,200 for the rest. Close the remaining long positions at ₹3,615.
Spandana Sphoorty Financial (₹351.8)
Steady downtrend
The major trend for the stock of Spandana Sphoorty Financial is bearish and the latest downfall began from about ₹740 in July 2021. The decline has been steady, and it has consistently been falling off the 21- and 50-day moving averages. Last week, it slipped below the support band of ₹390-₹400, opening the door for further weakening.
But the price action suggests that there could be a corrective rally to retest ₹400. A fall post this move can be swift where the stock can be dragged to ₹260, though there can be a pause at ₹300. So, traders can sell the stock now and short more if it rises to ₹400. The average sell price will be approximately ₹375. Place stop-loss at ₹425 initially and revise it to ₹350 on a fall below ₹300. Exit the shorts completely at ₹260.
Zydus Wellness (₹1,704)
Downswing set to extend
The stock of Zydus Wellness, which began its rally from about ₹1,200 in June 2020, hit a fresh lifetime high of ₹2,476.85 in September 2021. However, since then, it has been falling and last week it invalidated the support band of ₹1,800-₹1,840.
This is expected to draw more sellers and as a result the downswing is likely to extend. While the nearest support can be seen at ₹1,530, the scrip will probably depreciate more and touch ₹1,415 over the medium term. But it can be expected to move up to ₹1,800-₹1,840 before falling deeper. So, sell the stock now and on a rally to ₹1,800. The average price will be at ₹1,752. Stop-loss can be placed at ₹1,860. Exit 50 per cent of the position at ₹1,530 and shift the stop-loss to ₹1,630 for the rest. Exit the balance at ₹1,415.
PI Industries (₹2,593.6)
Outlook turns bearish
The stock of PI Industries saw its latest leg of rally between February and September 2021 when the price rallied from about ₹2,000 to hit a fresh all-time high of ₹3,534.9. But then the trend reversed, and it has been on a decline. Sellers are strongly positioned which led to the breach of another key support of ₹2,725 last week.
The medium-term trend is now bearish and therefore, the price is likely to fall to ₹2,370 and then to ₹2,200 in the coming months. Since there is a possibility of ₹2,725 being retested, one can sell now and on a rally to ₹2,725 so that average price is about ₹2,660. Primary stop-loss can be at ₹2,830 but revise it to ₹2,520 if the price slips below ₹2,370. Liquidate half of the shorts at ₹2,370 and the remaining at ₹2,200.
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