Technical Analysis

Stock Trading Call: Buy PNB Housing Finance

Yoganand D | Updated on February 02, 2020 Published on February 02, 2020

Investors with a medium-term perspective can sell the stock of PNB Housing Finance at current levels.

Ever since recording an all-time high at ₹1,715 in mid-2017, the stock has been in a long-term downtrend. Both the medium- and the short-term trends are down for the stock.

It has been in a medium-term downtrend since encountering a key long-term resistance at around ₹700 in late September 2019. After a corrective rally in early January, the stock met with a key resistance at ₹579 in mid- January and resumed the downtrend.

 

 

The short-term trend has been down since then. While trending down, the stock breached its 21- and 50-day moving averages recently, and trades well below them.

Last session, witnessing selling pressure, the stock tumbled 5 per cent, with an above-average volume break below a key base level of ₹426. This fall has strengthened the medium- as well as the short-term downtrend.

The daily relative strength index (RSI) has decisively entered the bearish zone and the weekly RSI has also re-entered the bearish zone from the neutral region. Backing the downtrend, the daily and the weekly price rate of change indicators feature in the negative territory.

Overall, the medium-term outlook is bearish for PNB Housing Finance. It can continue to trend downwards and reach the price targets of ₹370 and ₹350 with a minor pause at ₹370 levels. Traders can sell the stock with a stop-loss at ₹438.

 

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Published on February 02, 2020
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