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The outlook for the stock of Sunteck Realty is bearish. The price action since September 2021 indicates a head and shoulder pattern formation. The 4.85 per cent on Thursday, the stock below the neckline support of this pattern. The neckline is at ₹415. It will act as a good resistance. Any intermediate bounce will be capped at ₹415. The 21-day moving average (DMA) is on the verge of crossing below the 200-DMA.
This strengthens the bearish case and also indicates that upside could be restricted. The stock can fall to ₹365-₹360 in the next one or two weeks. Traders can go short at current levels. Accumulate shorts on a rise at ₹410. Keep the stop-loss at ₹421. Trail the stop-loss down to ₹392 as soon as the stock falls to ₹383. Move the stop-loss further down to ₹381 as soon as the stock touches ₹375. Book profits at ₹372. Note that the ₹365-₹360 region is a strong support zone. A trendline and the 100-week moving average are poised in this zone. As such the chances are high for the stock to bounce from this support zone.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)
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