Technical Analysis

Tech Query: Wait for Canara Bank stock to cross ₹170

Yoganand D BL Research Bureau | Updated on July 03, 2021

I have purchased Canara Bank shares at ₹225. What is the outlook for the stock?

V Natarajan

Canara Bank (₹153.8): Following a sharp fall from the ₹220 levels in February and March 2020, the stock found support at ₹75 in late March 2020 and started to move sideways. Thereafter the stock was on a broad sideways consolidation phase in the band between ₹80 and ₹120 until December 2020. It moved out of the range in January this year and registered a 52-week high at ₹174.4 in mid-February. Subsequently, the stock witnessed a corrective decline and began to consolidate at higher levels in the range between ₹125 and ₹170. Immediate support and resistance is placed at ₹140 and ₹163 respectively.

The daily indicators and oscillators are featuring in the neutral region. A fall below ₹140 can pull the stock down to ₹125 which can provide base for the stock. That said, a further fall below ₹125 will reinforce the bearish momentum and pull the stock down to ₹110 and then to ₹100 over the medium term. You can consider averaging the stock at lower levels and stay invested with a stop-loss at ₹90. An emphatic break above the key resistance level of ₹170 will bring back bullish momentum and push the stock northwards ₹200 and then to ₹220 levels. Resistances thereafter are placed at ₹240 and ₹280 levels.

I am holding shares of Glenmark Pharmaceuticals. What is the technical outlook?

Pradeep Kabra, Kunal Joshi

Glenmark Pharmaceuticals (₹662.5): In March 2020, the stock bottomed out after registering a multi-year low at ₹171. Since then, it has been in a long-term uptrend. After a sideways consolidation in the range between ₹445 and ₹550, the stock broke out of a key resistance at ₹550 in early April this year and continued to trend upwards. It has been in a medium term uptrend since April. Now, the stock takes a minor pause and tests resistance at ₹667. A strong breakthrough of this resistance will reinforce the bullish momentum and take the stock northwards to ₹700. A conclusive break-out of the long-term barrier at ₹700 will accelerate the stock higher to ₹745 and then to ₹800 levels over the long run.

On the other hand, a decline below the immediate support level of ₹600 will start threatening the medium-term uptrend and pull the stock down to ₹575 and then to ₹550 levels. A clear decline below the long-term vital base level of ₹550 will alter the medium term uptrend and drag the stock lower to ₹500 and then to ₹445 levels over the medium term. Investors with a long-term horizon can stay invested with a stop-loss at ₹430 levels.

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Published on July 03, 2021

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