M&M may dip 10% if fails to overcome Rs 1,500; RBL Bank may jump 15%

Technical charts of M&M shows weakness, while RBL Bank continues to remain resilient.

Shares of Mahindra & Mahindra plunged 6 per cent on Thursday, while RBL Bank rallied 3 per cent post the former purchased a stake in the latter on July 26. Mahindra & Mahindra bought 3.53 per cent stake in RBL Bank at a cost of 417 crore and aspires to buy more following necessary regularity terms. 

So far this year, M&M has gained merely 2 per cent, while RBL Bank has soared 35 per cent. While M&M has hit a new historic peak, RBL Bank is yet to claim its new territory. 

Here’s the technical outlook of these two entities amid stake purchase:-

Mahindra & Mahindra Ltd (M&M)

Outlook: M&M may slide 10% if fails to overcome Rs 1,500

Following the breaking out of the “Golden Cross”, the stock displayed a resilient rally that even managed to sustain in the overbought category of the Relative Strength Index (RSI). But, now the stock has breached the key support of Rs 1,500, suggesting that the collapse is supported by selling volume.

Immediate support falls at Rs 1,407-mark, its 50-simple moving average (SMA), followed by 1,350, the key reversal mark. The stock needs to overcome Rs 1,500 to restore the upside bias. The 200-SMA is located at Rs 1,288, acting as a major bolstering level. CLICK HERE FOR THE CHART

RBL Bank Ltd (RBLBANK)

Outlook: Rally to Rs 285, 15% upside

Post forming a consolidation in the range of Rs 230 to Rs 210, the stock has now broken out on the upside. This up move reveals an optimistic bias for upcoming sessions. The trend remains highly bullish, with price action battling firmly in the overbought category of the RSI.

Unless the support of Rs 210 is held, the positive bias cannot aspire higher levels of Rs 285. The weekly chart suggests a stable move post-closing over the 200-weekly moving average (WMA). CLICK HERE FOR THE CHART