What is the outlook on Reliance Industries (RIL)?
RIL (₹2,341.15) : Structurally, on the charts, RIL has been in an uptrend over the last five years. The recent fall since October is just a correction within the overall uptrend. Immediate support is at ₹2,300-₹2,250. Next support is in the ₹2,100-₹2,000 region. Investors wanting to enter the stock can consider buying at two levels. Buy 50 per cent on the total intended amount at ₹2,320 and the balance 50 per cent at ₹2,080. So, the average buy price will come at ₹2,200. Keep a stop-loss at ₹1,780 and wait for a target of ₹3,200.
What is the medium-term outlook for the stock of Steel Authority of India (SAIL)?
SAIL (₹112.3) : The stock has been in a strong uptrend since October last year. Within this uptrend, the stock has been in a gradual corrective fall since May this year. Immediate support is at ₹101-100. Next important strong support is in the ₹90-₹85 region, which can limit the downside. A break below ₹85 is unlikely. The stock is likely to see a fresh rally from the ₹90-₹85 region.
From a long-term perspective that rally will have the potential to target ₹200-₹250 levels. Investors with a medium-term and long-term perspective can buy at ₹95. Keep a stop-loss at ₹55. Hold it for the target of ₹230-₹250. In case the stock breaks below ₹85, though less likely, consider accumulating at ₹70.
I have bought shares of Tata Steel at ₹1,085. What is the long-term outlook for this share?
Vimal Kumar Manglam
Tata Steel (₹1,131.85) : The stock has seen a sharp correction since August this year. Strong resistance is in the ₹1,230-₹1,300 region. The stock is likely to remain below ₹1,300 now. Support is at ₹1,010-₹1,000. If the stock manages to hold above this support, a consolidation between ₹1,000 and ₹1,200 is possible for a month or two. Then a break above ₹1,200 will pave the way for a fresh rally to ₹1,600-₹1,650 over the medium term. But, if the stock breaks below ₹1,000, it can tumble towards ₹800. You can consider two options. One, buy more shares at ₹1,020. In case the stock breaks below ₹1,000 and extends the fall, you can buy more at ₹830. You can keep ₹720 as a stop-loss and hold it for the long term. Secondly, if you cannot afford the loss up to ₹800, keep a stop-loss at ₹960 now and exit with a loss. Maybe you can then wait to buy afresh at ₹830.
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