Vodafone Idea breaks 100-WMA, hits Rs 7.26 mark. What's next for the stock?

Shares of Vodafone Idea (VIL) tanked 12 per cent to hit a 52-week low of Rs 7.26 on the BSE in Tuesday's session after reports suggested Kumar Mangalam Birla has told the government that he is willing to give up promoter stake in the company. 

The stock of the telecom services company fell below its previous low of Rs 7.60 touched on October 19, 2020. It was trading at the lowest level since July 2020. The stock had hit a record low of Rs 2.61 in November 2019. READ HERE

Here's a look at what tech charts are signalling for the stock:

Vodafone Idea Ltd (IDEA)

Likely target: Rs 6 and Rs 5.50 (if stock closes below 100-WMA)

Downside potential: 20% - 25%

This is the first time the counter has broken 100-weekly moving average (WMA), currently placed at Rs 7.95, with active price momentum on a year-to-date (YTD) basis. This move, which seems to gain on volumes, has further pushed stock to 52-week low of Rs 7.60. In case the stock decisively closed below 100-DMA, the price action may enter in a bearish sentiment and drift lower towards Rs 6 and Rs 5.50 levels, indicating a downfall of nearly 25 per cent.

On the flip side, if shares of Vodafone Idea manage to uphold the support 100-WMA on the closing basis, then the stock could see a jump towards the resistance of Rs 9.90 levels, which is the 50-WMA.                     

Whenever any stock hits a new 52-weeks low, the price action and technical indicators reflect a negative bias, which is so with the Vodafone Idea. However, a decisive weekly close would provide a definite outlook. CLICK HERE FOR THE CHART