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The stock has been in a downtrend since April. This has gained momentum after the 5 per cent fall on Thursday and the stock price well below the 200-day moving average (DMA). It also marks the end of the sideways consolidation that was in place for about a week. In addition to this, the 21-DMA is on the verge of crossing below the 100-DMA. This strengthens the bearish case and indicates that the upside could be limited in case if any bounce is seen. As such a fresh leg of fall has begun within the broader down trend.
The 200-DMA at ₹576 will now act as a strong support-turned-resistance level and cap the upside. The stock can fall to ₹533 in the next one week. A further break below ₹533 will see the downmove extending towards ₹490 over the next couple of weeks. Traders can go short now. Accumulate shorts at ₹570. Keep the stop-loss at ₹585. Trail the stop-loss down to ₹545 as soon as the stock falls to ₹535. Move the stop-loss further down to ₹525 as soon as the stock touches ₹515 on the downside. Book profits at ₹505.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)
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