Technical Analysis

Tech Query: Should you book profit in NMDC shares bought at ₹120 levels?

Yoganand D BL Research Bureau | Updated on May 09, 2021

I have shares of NMDC bought at an average price of ₹124. Can I continue to stay invested or book profit?

Gopalakrishnan S

NMDC (₹184.9): The stock of NMDC was in the limelight in the past week as it skyrocketed 18.8 per cent with good volume, decisively breaking through a key long-term resistance at ₹160. It had been in a broad sideways consolidation phase in the band between ₹73 and ₹160 since early 2015. This recent breakthrough of the upper boundary and the key long-term hurdle at ₹160 has strengthened the bullish momentum. In early March 2020, the stock took support in the ₹60-₹63 band and started to trend upwards. Since then, the stock has been in an intermediate-term uptrend. The stock had emphatically breached key resistance at ₹140 in late April this year and another resistance at ₹160 in the previous week. These levels will turn into key supports now.

On the upside, the stock faces a crucial resistance ahead at ₹200 which could limit the upside temporarily as the daily and the weekly relative strength indices are featuring in the overbought territory. Therefore, you can consider booking partial profits at around this resistance. An emphatic break-out of ₹200 can take it to ₹220 and then to ₹250 levels over the medium term. Next resistances are at ₹280 and ₹300. If the stock declines below the immediate support level of ₹160 it will alter the short-term uptrend and pull it lower to ₹150 and then to ₹140 levels. You can consider such declines to average the stock with a long-term stop-loss at ₹115. As long as the stock trades above the vital base in the band between ₹120 and ₹125 the intermediate-term uptrend will remain in place. Key supports below ₹120 are placed at ₹108 and ₹100.

What is the outlook for Bosch?

Ishwar Parik

Bosch (₹13,616.6): After registering a 52-week high at ₹16,900 in early January this year, the stock of Bosch has been in a medium term downtrend. In early April, the stock met with a resistance at around ₹14,950 and started to decline. It has been in a short-term downtrend since then. Key support in the ₹13,260 and ₹13,300 band is cushioning the stock. A fall below this base can strengthen the short-term downtrend and pull it down to ₹13,000 and then to ₹12,500 in the medium term.

That said, if the stock emphatically breaks through the significant support level of ₹12,500, it will underpin the medium-term downtrend and drag the stock lower to ₹12,000 or even to ₹11,500 levels. Next key supports are placed at ₹11,000 and ₹10,000. Conversely, if the stock manages to rally above the immediate resistance at ₹14,000 and then at ₹14,300, the short-term downtrend will be altered and take it higher to ₹15,000. A strong break-out of ₹15,000 will alter the medium term downtrend and can pave the way for an up-move to ₹16,000 and then to ₹17,000.

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Published on May 09, 2021

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