HUL, Colgate, UBL: Here's how to trade FMCG stocks post ITC de-merger plan

Nifty FMCG index slips over 1 per cent on Tuesday post tumbling 2 per cent in the previous session, following ITC declaring demerge of its hotel business.

shares of ITC on Tuesday plunged close to 3 per cent post dipping 4 per cent in the last session. Britannia Industries and Varun Beverages too witnessed a cut of 2 per cent and 1.50 per cent, respectively.

The FMCG index has breached previous reversal support, igniting fear of caution among retail traders. This move emerged after the index reached a new historic peak a few sessions ago.

Here’s the technical out of FMCG stocks amid ITC declaring its demerger:-

NIFTY FMCG

Likely target: 55,500

Upside potential: 3%

The index is presently struggling to sustain over the 54,000 level. On the downside, the support exists at 51,600, which is its 50-SMA. The next key support comes to 51,000-level. A sustained move over 54,000 shall see a sharp rally towards 55,500. There are negative divergences on the daily chart, and if the counter fails hold key levels, medium-term weakness may take over the trend.  CLICK HERE FOR THE CHART

Hindustan Unilever Ltd (HINDUNILVR)

Outlook: 200-DMA holds the support key

While the stock has breached the trend line support existed at Rs 2,650-mark, the price action if holds the 200-SMA support, the trend may see revival. The 200-SMA is set at Rs 2,567. Immediate hurdle falls at Rs 2,655, which is its 50-SMA. The stock needs to cross Rs 2,700, with aggressive volumes to restore the positive bias. A breach of 200-SMA could lead to Rs 2,400-mark. CLICK HERE FOR THE CHART

Colgate Palmolive (India) Limited (COLPAL)

Likely target: Rs 2,100

Upside potential: 10%

The gradual upside in the shares of Colgate Palmolive (India) continues to stay elevated. Immediate support falls at Rs 1,800-level, its previous breakout mark. The trend remains upward until the support of Rs 1,700 continues to bolster. The stock is on the track to hit Rs 2,100. The volume on the upside breakout has seen aggressive structure, signifying that the trend to revisit accumulation if any weakness emerges. CLICK HERE FOR THE CHART

Tata Consumer Products Ltd (TATACONSUM)

Likely target: Rs 975

Upside potential: 10%

Once the stock persists over the hurdle mark of Rs 880, the upside breakout shall move in the direction of Rs 975, as per the pattern breakout. The support falls at Rs 820, which is its 50-DMA. A move over Rs 880 will spark “Golden Cross” breakout, as per the daily chart. The said breakout will formulate positive medium-term bias. CLICK HERE FOR THE CHART

United Breweries Limited (UBL)

Likely target: Rs 1,700

Upside potential: 10%

Shares of UBL have a breakout of “Inverse Head and Shoulder”, with stock price sets to further rally towards the 200-day moving average (DMA). Once the 200-DMA placed at Rs 1,550 is conquered, the up move shall move in the direction of Rs 1,700-mark, as per the daily chart. The support for the current bias stays at Rs 1,480, its 50-SMA. CLICK HERE FOR THE CHART