Bonjour, new guests from small-town India
Puneet Dhawan of Accor is brimming with ideas on ways to revive the hospitality sector
Here are the answers to readers’ queries on the performance of their stock holdings.
What is the outlook for Tata Motors?
Sarvesh Goel
Tata Motors (₹186): Since encountering a key long-term resistance at ₹595 in September 2016, the stock of Tata Motors has been on a long-term downtrend, forming lower troughs and lower peaks. Medium-term trend is also down. After recording a multi-year low at ₹141 in February 2019, the stock reversed direction and was on a short-term uptrend until it met a resistance at ₹235 in mid-April.
The stock again began to decline from this resistance. Last week, it plunged 11 per cent, breaking below a key support at ₹200 and the 200-day moving average. The stock appears to have resumed a medium-term downtrend. It hovers well below the 50- and 200-day moving averages.
The stock can extend the downtrend and test support at ₹170 in the short term. A further decline below this base level can drag the stock down to ₹150 over the medium term.
An emphatic fall below the long-term support band between ₹140 and ₹150 will reinforce the primary downtrend and pull the stock down to ₹120 and then to ₹100 in the long run.
On the other hand, a strong rally above the immediate resistance at ₹200 can take the stock higher to ₹235 and ₹250 levels. To alter the medium-term downtrend, the stock needs to decisively break above the vital resistance at ₹300. Such a break can strengthen the bullish momentum and take the stock northwards to ₹350 and then to ₹380 over the long term. Investors with a long-term perspective can consider buying above ₹235.
Can I average the stocks of Prakash Industries and Rain Industries at the current prices?
Pradeep Kabra
Prakash Industries (₹71.2):Since recording a multi-year high at ₹276 in January 2018, the stock has been in a long-term downtrend. Medium- and short-term trends are also down. However, the stock currently tests a key long-term support in the range between ₹63 and ₹67. A fall below the base level can drag the stock down to ₹50. But a strong rise above the immediate resistance at ₹80 can take the stock higher to ₹95 and then to ₹100. A breakthrough of ₹100 can push the stock northwards to ₹120 and ₹140 levels in the long term. Consider averaging above ₹80 with a stop-loss at ₹63.
Rain Industries (₹109.8): The long-term trend is down for the stock. But it found support in the band between ₹90 and ₹95 in February 2019. Since then, the stock has been in a sideways range between ₹90 and ₹150. You can average at the current levels with a stop-loss at ₹85.
A strong break above ₹150 will strengthen the bullish momentum and take the stock higher to ₹200 in the long term. The next key resistances are placed at ₹230 and ₹250 levels. Supports below ₹90 are at ₹80 and ₹70.
Send your queries to techtrail@thehindu.co.in
Please Email the Editor