ITC, HUL, Marico, Dabur: Here's how to trade FMCG stocks post Budget 2020

Hindustan Unilever may rally towards Rs 2,300 if it trades above Rs 2,150 levels.

Markets on Saturday reacted negatively to the Union Budget 2020-21 presented by the Finance Minister Nirmala Sitharaman as the proposals failed to cheer market participants. Shares of tobacco manufacturers took a beating as the government proposed to increase the National Calamity Contingency Duty (NCCD) on cigarettes, hookah, chewing tobacco, snuff and tobacco extracts and essence. ITC on Monday slipped over 5 per cent and hit a fresh 52-week low on the BSE. 

Here's a look at what technical charts indicate for ITC and other FMCG counters - 

ITC Ltd (ITC): A major breakdown below Rs 250 may lead to a further sell-off. This weakness may deteriorate the upside sentiment. On a bigger perspective, the counter has broken support levels of Rs 220, while witnessing sharp sell-off on Saturday. The overall trend suggests weakness and the counter may slip to Rs 180 and Rs 170 in the near future. CLICK HERE FOR THE CHART

Hindustan Unilever Ltd (HINDUNILVR): This counter is witnessing buying momentum and if it stays above Rs 2,150 for two consecutive sessions, then it may climb to Rs 2,300 in the coming days. The Relative Strength Index (RSI) has crossed the trend line resistance on the upside. It has entered overbought territory, but until Moving Average Convergence Divergence (MACD) stays in positive crossover, one can expect higher levels in the market. CLICK HERE FOR THE CHART 

Marico Ltd (MARICO): As the counter breached Rs 325 – Rs 330 range with strong selling volumes, the overall trend has turned into a bearish phase. Now, with a negative crossover of 50-day moving average (DMA), 100-DMA with 200-DMA, the upside reversal may see shorting opportunities. One may see a bounce back towards Rs 320; however, this may be short-lived and will eventually see selling pressure. CLICK HERE FOR THE CHART

Dabur India Ltd (DABUR): A consolidation in the range of Rs 505 – Rs 475 can be seen as per the daily chart. On the downside, Rs 470 remains as a buying support and till upside resistance is not broken, the range may act as a trading bias. RSI and MACD are trading in negative crossovers. CLICK HERE FOR THE CHART

Emami Ltd (EMAMI): In the recent past, the counter managed to cross 200 DMA but failed to sustain above the same. Currently, the 200-DMA is placed at Rs 319. Till the counter stays below this, the weakness may persist. The support comes at Rs 275 levels as per the daily chart. The MACD has fallen below the zero line, indicating a weak trend. CLICK HERE FOR THE CHART