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Investors with a short-term perspective can sell the stock of Bombay Dyeing & Manufacturing Company at current levels.
The stock has been on an intermediate-term uptrend since taking support at ₹66 in August 2017. This uptrend got accelerated in December. However, the stock encountered a key resistance at around ₹300 in late December and again in early January and began to decline triggered by negative divergence in the daily relative strength index.
On Tuesday, the stock plunged 6 per cent breaching an immediate support at ₹275 signalling a trend reversal. Further, the selling pressure intensified and the stock tumbled another 6 per cent on Thursday. There has been an increase in daily volume over the past three days.
The short-term outlook is bearish. It can continue to decline and reach the price targets of ₹240 and ₹235. Traders can sell the stock with a stop-loss at ₹256.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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