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Here are answers to readers’ queries on the performance of their stock holdings.
Can I buy shares of Shipping Corporation of India at current levels? Also, I bought shares of HCL Infosystems at ₹123. Should I book loss or buy now to average?
S Subramanyan
Shipping Corporation of India (₹89.4): Following a non-stop decline during 2011 and 2012, the stock of Shipping Corporation of India bottomed out in August 2013, recording a multi-year low at ₹26.2. Since then, the stock has been on an intermediate-term uptrend.
The stock decisively broke through a key long-term resistance level at ₹70 in September 2015 and continued its upward journey. Moreover, the medium as well as short-term trends are up. Last week, the stock surged 8 per cent accompanied by good volume, breaching a significant resistance at ₹85. You can consider buying the stock current levels and accumulate in dips with a stop-loss at ₹68.
Important supports to note are pegged at ₹85, ₹75 and ₹70 levels. As long as the stock trades above the key long-term support level of ₹60, the intermediate-term uptrend will remain in place.
Continuation of the stock's ongoing uptrend can encounter resistances at ₹100 and then at ₹115 in the medium term. To alter the long-term downtrend, the stock needs to breach the key resistance band between ₹115 and ₹120. Such a rally can take the stock northwards to ₹140 and ₹165 in the long run.
HCL Infosystems (₹56.4): The stock of HCL Infosystems formed a double bottom pattern — a bullish reversal pattern and broke out of its neckline at around ₹52 in early October 2015. But the ongoing rally is struggling to move past the key resistance level of ₹65.
The stock has been in a sideways consolidation phase in the range between ₹52 and ₹65 over the past two months. In recent times, the daily volumes are declining and the indicators in the daily chart are showing signs of weakness.
Given that the broader indices are also witnessing a sell-off, the stock can decline to test the lower boundary at ₹52 in the short term. A breach of this level, can pull the stock down to ₹48 and then to ₹45 in the ensuing months. But medium-term uptrend will be under threat if the stock breaches the key support level at ₹45.
In such a scenario, the stock can decline and find support at its long-term zone between ₹31 and ₹33. You can consider averaging the stock at lower levels with a stop-loss at ₹31.
On the other hand, an emphatic rally beyond ₹65 can take the stock higher to ₹75 and then to ₹90 in the medium to long term. Envisioning a move beyond the long-term resistance level of ₹90 is tough at this juncture. Hence exit at this level.
I hold shares of Control Print bought at ₹88. What are the prospects for the company.
Anand R
Control Print (₹456.1): In June 2014, the stock emphatically broke out of a key long-term resistance band between ₹90 and ₹100. Since then, the stock has not revisited that level. It has just been trending up, becoming a multi bagger. As you sit on extraordinary profits and the stock has reached a saturation point — hitting a resistance at around ₹480 last week — you can consider booking partial profits at this juncture and re-entering at lower levels. You can hold the remaining stock with a stop-loss placed at ₹260.
The stock can find an immediate support at ₹425 and then at ₹370 levels. Strong rally above ₹480 can take the stock higher to ₹500 levels once again and subsequently to new highs.
Send your queries to techtrail@thehindu.co.in
Send your queries to techtrail@thehindu.co.in
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