Business Daily from THE HINDU group of publications
Sunday, Oct 10, 2010
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Investment World - Technical Analysis
Markets - Stock Markets
Reliance Industries (Rs 1,048.2)
The stock moved up in line with our expectation and achieved our price target of Rs 1,045 in the previous week. It gained 4 per cent backed by good volumes over the past week. Though the stock has breached its 200-day moving average marginally, it is still currently testing medium-term trend deciding levels around Rs 1,050-1,055. Inability to move above this level will pull the stock lower to Rs 1,035. Key supports for the stock are at Rs 1,010 and Rs 985.
The stock has been on a short-term uptrend from its September low of Rs 885. Short-term traders should initiate fresh long positions only if the stock moves above Rs 1,055 with tight stop-loss at Rs 1,035 levels and target of Rs 1,090. Subsequent resistance for the stock is at Rs 1,110.
State Bank of India (Rs 3,244.9)
After recording fresh life-time high of Rs 3,299, the stock slipped and finished the week down by Rs 16. As anticipated, the stock reversed lower from Rs 3,300 levels and reached Rs 3,200 before bouncing higher. The near-term outlook for the stock is one of ‘wait and watch'. Thus, short-term traders can stay away from the stock as long as it trades in the range between Rs 3,170 and Rs 3,280. A fall below Rs 3,170 will drag the stock lower to Rs 3,100 or Rs 3,050 levels in the near-term.
Medium-term trend is up for the stock and investors can remain invested with stop-loss at Rs 2,600. Strong close above Rs 3,300 will push the stock higher to Rs 3,350 or Rs 3,370. Medium-term supports for the stock are pegged at Rs 3,000 and Rs 2,880.
Tata Steel (Rs 626.9)
Tata Steel tumbled 6 per cent for the week, experiencing selling interest for the last couple of trading sessions. In our previous review we had mentioned that a fall below Rs 650 will weaken the stock and pull it to Rs 630 or Rs 610. Near-term trend is negative for the stock and reaching Rs 610 is on the cards. Short-term traders can sell the stock while maintaining stop-loss at Rs 640 with target of Rs 610 or Rs 595.
Medium-term investors holding long positions can take profits off the table and be cautious on the stock. Support and resistance for the week are at Rs 575 and Rs 660 respectively.
Infosys Technologies (Rs 3,077.4)
The stock was volatile and moved sideways in the zone between Rs 3,037 and Rs 3,162 this past week, finishing Rs 26 lower. Inability to move beyond Rs 3,115 will pull the stock down to Rs 3,037. Traders with short-term perspective should tread with caution in the stock in the upcoming week.
The stock continues to remain in a medium-term up trend and investors can consider holding the stock with stop-loss at Rs 2,750 levels. Medium-term price target is Rs 3,200. — Yoganand D.
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