Technical Analysis

Pivotals - Reliance Industries (Rs 734.3)

Yoganand D. | Updated on July 07, 2012 Published on July 07, 2012




Testing the upper boundary of the near-term sideways trading range between Rs 700 and Rs 742, the stock finished the week down by Rs 3.

Short-term traders can continue holding their long positions while maintaining stop-loss at Rs 698.

An emphatic upward breakthrough will take the stock higher to Rs 772 or to Rs 792 in the approaching weeks. Medium-term significant resistance is at Rs 868.

A strong weekly close above this level is required to end the continuing volatility in the stock. Investors with a medium-term perspective can consider accumulating the stock with stop-loss at Rs 650.

Infosys (Rs 2,443.8)

The stock declined 2.4 per cent in the previous week after testing the key resistance at Rs 2,500. A strong fall below Rs 2,410 will be cues for initiating fresh short position with same as stop-loss. Downside targets are Rs 2,350 and Rs 2,310-2,300. Strong decline below Rs 2,300 will drag the stock downwards to Rs 2,200 in the medium-term.

On the other hand, conclusive breakthrough of Rs 2,500 will reinforce bullishness and can lift the stock higher to Rs 2,550 and Rs 2,600. Next important resistance is at Rs 2,700.

State Bank of India (Rs 2,218)

Last week, the stock advanced 2.7 per cent with low volumes which is concerning. Traders can initiate fresh long positions only if the stock emphatically rallies above Rs 2,230 while maintaining stop-loss at the same level. Upside targets are Rs 2,326 and then Rs 2,494.

Near-term support for the stock is in the zone between Rs 2,130 and Rs 2,150.

However, a decline below Rs 2,030 will mar the stock’s short-term uptrend and pull it down to Rs 1,977 or to Rs 1,900. Subsequent key support is at Rs 1,800.

Tata Steel (Rs 447.4)

Tata Steel witnessed a modest gain of 1.4 per cent last week. The stock has significant resistance ahead at Rs 460 and Rs 470. A strong weekly close above Rs 470 is needed to lift the stock higher to Rs 500 in the medium-term.

Short-term trend has been up for the stock since its June low at Rs 389. It is hovering well above its 50- and 200-day moving averages.

Decisive fall below Rs 420 will mitigate the short-term uptrend and pull the stock down to Rs 405 or to Rs 395 in the ensuing weeks.

Important medium-term resistance for the stock is in the range between Rs 490 and Rs 500.

The stock has to conclusively breakthrough this range to signal that medium-term outlook is bullish. In that case, the stock can trend northwards to Rs 535 and Rs 583.

Published on July 07, 2012
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