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Here are answers to readers’ queries on the performance of their stock holdings.
I have shares of Siemens bought at ₹773. I have ABB at ₹1,334 for past two months. Advise on exit and buying levels.
Manoj
Siemens (₹1,366.8): The Siemens stock decisively broke through its significant long-term resistance level of ₹1,000 in late February this year. It registered a new high at ₹1,499 on March 13. Since the September 2013 low of ₹414, the stock has been on a long-term uptrend. The medium-term up-trend has been in place from the December 2014 low of ₹795 levels.
Having said that, the stock is losing its bullish momentum and has started to decline recently. The indicators in the daily and weekly charts are weakening, supporting the stock’s decline. You can consider booking partial profits at this juncture as you are currently sitting on huge profits and re-entering at lower levels of around ₹1000. The long-term uptrend will remain in place as long as the stock trades above the key resistance band between ₹950 and ₹1000.
Investors with a long-term perspective can hold the stock with a stop-loss at ₹940 levels. Immediate supports are placed at ₹1,300 and ₹1,250 levels. Medium-term uptrend will be under threat if the stock conclusively falls below ₹1,150 levels. Key resistances above ₹1,400 are at ₹1,500 and ₹1,600 levels.
ABB India (₹1,268.4): The stock recorded a multi-year high at ₹1,525 this February and started to decline, triggered by negative divergence in the indicators. Nevertheless, the stock now hovers above a significant long-term support level of ₹1250.
A strong fall below this level will have bearish implications and pull the stock down to ₹1,100 or even ₹1,000 in the short to medium-term timeframe.
Therefore, you can consider averaging the stock at lower levels with a stop-loss at ₹950 levels. The long-term trend will remain up as long as the stock trades above the key support of ₹850 and ₹900 zone. Resistances to note are at ₹1,400 and ₹1,500. An emphatic rally above ₹1,500 can take the stock northwards to ₹1,670 in the long term.
What is your medium to long-term outlook on R.S.Software?
Sarvesh Bhasker
R. S. Software India (₹200.6): After taking long-term support in the band between ₹85 and ₹90, the stock started to trend northwards in May last year. It stock conclusively breached its long-term resistance at around ₹287 in early September 2014 and went on to record a new high at ₹415 that month.
Subsequently, the stock changed direction triggered by negative divergence in the weekly indicators.
Since then, the stock has been on an intermediate-term downtrend. Short-term trend is also down. The stock has retraced more than 61.8 per cent Fibonacci retracement level of its prior uptrend.
The stock now tests a key long-term support around ₹200.
The indicators in the daily and weekly charts feature in the bearish zone, backing the downtrend. A strong fall below the current support level will strengthen the downtrend and pull the stock down to ₹175 and then to ₹150 in the medium term.
Such a fall will extend the intermediate-term trend into the long-term. In that scenario, the stock can even decline to the ₹100 to ₹110 support band in the long run.
To alter the ongoing downtrend, the stock needs to emphatically rally above ₹300 for an up move to ₹350 levels. Immediate key resistances are at ₹226 and ₹250 levels.
Send your queries to techtrail@thehindu.co.in
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