Technical Analysis

Your stock portfolio: Just Dial resumes its uptrend

Yoganand D | Updated on January 08, 2018

Here are answers to readers’ queries on the performance of their stock holdings.

Please give your view on Just Dial bought at ₹537

N Ravi

Just Dial (₹550.5): The stock of Just Dial gained 6.7 per cent on Friday, decisively breaking above a key short-term resistance at ₹530. With this rally, the stock resumes its intermediate-term uptrend that has been in place since taking support from a long-term base level of ₹330 in August 2017. Both the short as well as medium-term trends are up for the stock.

While trending up, the stock emphatically breached a significant long-term resistance at 490 in early November and managed to stay above this level thereafter. The stock trades well above its 21 and 50-day moving averages. The daily and weekly relative strength indices have entered the bullish zone from the neutral region.

Moreover, the daily as well as weekly price rate of change indicator is featuring in the positive territory, implying buying interest.

There has been an increase in daily volume over the past the weeks. The stock can extend its medium-term uptrend and test resistance in the band between ₹600 and ₹620 in the coming weeks. Further breakthrough of this resistance band can take the stock northwards to ₹700 and ₹750 in the ensuing months. That said, the long-term trend has been down for the stock from its 2014 peak of ₹1,894. A strong rally beyond ₹1,100 is needed to alter the downtrend. Long-term resistances above ₹750 are pegged at ₹810 and ₹900. Key immediate support is in the zone between ₹490 and ₹500. Strong plunge below this zone will alter the short-term uptrend and pull the stock down to ₹465 and ₹450 levels. Such a decline will also be threat to the medium-term uptrend. Next supports below ₹450 are at ₹425 and ₹400.

I purchased shares of Reliance Naval & Engineering at ₹56. Should I hold or sell?

Sunil Kumar Jain

Reliance Naval and Engineering (₹57.2): The stock skyrocketed 32 per cent last Monday, decisively breaching a key resistance at ₹51. However, the stock failed to break above the significant long-term resistance in the band between ₹70 and ₹74. After testing this resistance zone, the stock witnessed selling pressure and started the decline giving up some gains to close the week with a 16 per cent jump. It has an immediate support at ₹55 and resistance at ₹60.

The long-term trend has been down for the stock since encountering a key resistance at ₹114 in January 2016. To alter this downtrend, the stock needs to conclusively rally above ₹74.

Such a rally will strengthen the short-term uptrend that has been in place since late December and take it higher to ₹80 and ₹84 levels. But, a strong plunge below ₹50 may bring back selling pressure and pull the stock down to ₹45 and ₹40 levels in the medium term. You can stay invested with a fixed stop-loss at ₹49 and consider booking partial profits in the band between ₹70 and ₹74.

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Published on January 07, 2018

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