Technical Analysis

Repco Home Finance (₹383.8): Sell

Yoganand D BL Research Bureau | Updated on June 06, 2019

Investors with a short-term horizon can sell the stock of Repco Home Finance at current levels. The stock has been in a long term downtrend since encounter a key resistance at ₹900 in June 2017. After a corrective up-move, the stock encountered a key resistance at around ₹475 in March 2019 and resumed the downtrend triggered by negative divergence in the daily indicators. Since then, the stock has been in a medium-term downtrend.

The 200-day moving average has been limiting the upside over the past two months. In mid-May, the stock met with a resistance and continued to trend downwards. It hovers well below the 50- and 200-day moving averages.

On Thursday, the stock tumbled 4.2 per cent accompanied by above average volume breaking below a key support at ₹400. This fall has strengthened the downtrend. The daily relative strength index has entered the bearish zone from the neutral region and the weekly RSI is likely to enter the bearish zone from the neutral region. Moreover, the daily as well weekly price rate of change indicators features in the negative territory implying selling interest.

The short-term outlook is bearish for the stock. Targets are ₹368 and ₹360. Traders can sell with a stop-loss at ₹392.

(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)

Published on June 07, 2019

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