PC Jeweller can glitter in the long run

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

What are the short and medium-term support and resistance levels for PC Jeweller and GHCL?

Ramprasad V

PC Jeweller (₹422.1): Since bottoming out in January 2014, the stock of PC Jeweller has been on a long-term uptrend. After registering a new high of ₹531 in September 2016, the stock's upside got capped and subsequently nose-dived sharply in early November, following the announcement of demonetisation.

However, it found support at its long-term base zone between ₹290 and ₹300. The stock has been on an intermediate-term uptrend since last November. But immediate resistance at ₹440 has been limiting the stock's upside since mid-March.

Strong breakout of this resistance will strengthen the uptrend and take the stock higher to the next key resistance level at ₹470 and ₹500 in the medium term. Further rally beyond ₹500 can see the stock revisit the September high and record new highs in the long run.

On the other hand, if the stock struggles to move past ₹440 and breaks below the immediate support level of ₹400, it can go down to ₹370 or ₹360 levels in the medium term.

Conclusive downward break of ₹360 is needed to alter the intermediate-term uptrend and pull the stock down to ₹330 and then to ₹300 levels. Strong plunge below the long-term base zone between ₹290 and ₹300 will mitigate the long-term uptrend and pull the stock down to ₹270 and then to ₹250. Investors with a long-term perspective can hold the stock with a stop-loss at ₹290. Traders or investors with a medium-term view can stay invested with a stop-loss placed at ₹360.

GHCL (₹263.6): The stock of GHCL has been on a long-term uptrend from its significant support base at around ₹30 in September 2013. While trending up, it emphatically breached key resistance at ₹100 and at ₹190, which is a key long-term hurdle. Since recording a new high of ₹298 in October 2016, the stock has been on a sideways consolidation phase in the ₹230-290 range.

Decisive rally beyond ₹290 can take the stock northwards to new highs. But a downward break of ₹230 can see the stock find support either at ₹205 or ₹190 in the medium term. Investors with a medium-term perspective can hold the stock and accumulate at declines while maintaining a stop-loss at ₹190. Strong downward breakout of the key long-term support level of ₹190 can pull the stock down to ₹120 and ₹100 levels. Short-term support is at ₹255 and resistance is placed at ₹275 levels.

What are the long-term prospects for Inox Wind? I have shares bought at ₹220.

Mahipal Madasu

Inox Wind (₹204.5): The stock of Inox Wind has been on a long-term downtrend ever since it recorded a new high of ₹494 in April 2015. The stock found support at ₹161 in September 2016 and started to move sideways in the ₹161-220 band.

Since then, it has been in a medium-term sideways consolidation phase. After testing the lower boundary at ₹161 in early April, the stock began to trend upwards and its near-term trend is up.

Last week, it gained 9 per cent with extraordinary volume. There has been an increase in weekly volume for the past nine weeks, which is a positive sign. The stock now faces key resistance at the upper boundary (₹220).

Strong break above this level can pave the way for an up-move to ₹245 and ₹295 levels in the medium to long term. Further breach of ₹295 can alter the long-term downtrend and take the stock higher to ₹340 and ₹375 levels. Immediate supports are placed at ₹195 and ₹180 levels. Strong plunge below ₹161 will bring back selling pressure and drag the stock to new lows. You could accumulate the stock with a stop-loss at ₹170.

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