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Top technical calls from Sameet Chavan, Chief Analyst- Technical and Derivatives of Angel Broking:
Last Close – Rs. 587.95
Recently, this stock underwent a strong corrective phase as we saw massive price erosion of more than 20% in merely two months. Now, the stock has reached its multiple historical support zone of 580 – 585. This coincides with the weekly ’89 EMA’ level and hence, can be considered as a major support in the near term. In last two sessions, the stock prices have been bouncing back from lows and have formed two narrow range candles. Considering this we expect the stock to give a bounce back rally soon. Hence, we advise traders to buy this stock at current levels and on declines at Rs.580 for a target of Rs.632 over the next 6- 8 sessions. The stop loss now should be fixed at Rs.570.
View – Bearish
Last Close – Rs. 149.60
Due to Thursday’s fall, the stock prices breached its ‘200-SMA’ support level of 152. As a result, a ‘Lower Top Lower Bottom’ structure on the daily chart has been formed, which is a negative sign for short term. The ‘RSI’ oscillator too has given a breakdown from its long term support. On Friday, the stock managed to give a decent pullback move, which should ideally be used as a selling opportunity. Thus, we recommend selling this stock at current levels and on a bounce up to Rs.150.50 for a target of Rs.131 over the next 5 – 10 sessions. The stop loss should be fixed at Rs.159.
Shriram Transport Finance
View – Bearish
Last Close – Rs. 952.05
If we look at the daily chart, the stock prices have sneaked below the support level of ‘Upward Sloping Trend Line’, which provided decent support in last two months. This confirms a bearish reversal pattern known as ‘HEAD N SHOULDER’. In addition, The ‘RSI’ oscillator has given a bearish crossover with its smoothened moving average which does not augur well for the bulls. Thus, we recommend selling this stock at current levels and on a bounce up to Rs.960 for a target of Rs.895 over the next 5 – 10 sessions. The stop loss should be fixed at Rs.974.
Disclaimer: The analyst may have positions in any or all the stocks mentioned above.