Technical Analysis

Support at ₹250 can cap ITC’s decline

GURUMURTHYK | Updated on January 16, 2018 Published on September 18, 2016

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ITC (₹260.4)

As expected, ITC fell to test the support at ₹250 and reversed sharply from there last week. A rise to test the resistance at ₹267 looks likely in the coming week. If the stock manages to surpass this hurdle, it can test ₹270. A strong break above ₹270 is needed for the stock to gain momentum. Such a break will pave the way for a fresh rally to ₹290 or ₹295 over the medium term. On the other hand, if ITC fails to break above ₹267 and reverses lower, it can fall to ₹260 initially. Further break below ₹260 will increase the likelihood of the stock extending its fall to ₹255 or even ₹250 once again. The near-term view will turn negative only if the stock declines below ₹250. The next target will be ₹242. But such a fall looks less likely at the moment. Investors who have taken long positions on dips near ₹255 and ₹250 last week can hold it. Retain the stop-loss at ₹235. Accumulate on dips near ₹255. Revise the stop-loss higher to ₹240 as soon as the stock breaks above ₹270.

Published on September 18, 2016
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