These 2 Tata Group stocks can dip up to 16% in the near term, charts hint

Tata Chemicals had rallied 46 per cent in the last six trading sessions; a 50 per cent retracement of the rally could see the stock dip to Rs 1,217, shows chart

Shares of Tata Group of companies have been in limelight in recent trading sessions amid buzz of likely Tata Sons IPO. Tata Chemicals in particular has been in the thick of the action.

However, in trades on Monday, select shares  of the Tata Group were seen trading with losses up to 12 per cent on reports that Tata Group may avoid going public next year.

Reports stated that the N Chandrasekaran-led company was exploring options of transferring its debt to a separate entity so that it is excluded from the 'upper layer' list, the conglomerate's much-awaited listing was unlikely. READ MORE

As per the Tata Sons shareholding pattern, Tata Chemicals, Tata Motors, Tata Power and Indian Hotels held over 1 per cent state in the group company. 

Here's a quick chart check on these Tata Group stocks.

Tata Chemicals

Current Price: Rs 1,199

Downside Risk: 10%

Resistance: Rs 1,215

Support: Rs 1,171

Prior to today's 10 per cent fall, shares of Tata Chemicals had rallied 40 per cent in the preceding six trading sessions. Even as the price-to-moving averages action remain favourable for the stock in the short-to-medium term time frame. Sustained trade below Rs 1,215 level is likely to act as a consolidation trigger for the stock.

As per the retracement pattern, at present levels, the stock is seen trading close to its 38.2 per cent retracement of its recent rally, which stands at Rs 1,171. Break and sustained trade below the same, can trigger a slide towards 50 per cent and 61.8 per cent retracement levels at Rs 1,127 and Rs 1,083, respectively. CLICK HERE FOR THE CHART

Tata Motors

Current Price: Rs 1,028

Downside Risk: 16.3%

Resistance: Rs 1,065

Support: Rs 995

Tata Motors has witnessed a phenomenal 153 per cent rally in its share price so far this fiscal year. However, even as the overall trend remains positive, the stock is likely to enter a phase of consolidation as indicated by select key momentum oscillators on the weekly scale. 

The weekly RSI (Relative Strength Index) is in fairly overbought zone and quotes near-about 90 levels. Technically, a reading above 70 is considered overbought. That apart, the Stochastic Slow has given a minor negative divergence and the MACD (Moving Average Convergence-Divergence) too is seen converging. Hence, the stock may consolidate going ahead.

Among the key levels to watch out, the recent high around Rs 1,065 may act as the crucial hurdle. Whereas, on the downside, near support for the stock can be expected around RS 995. Break and sustained trade below Rs 995, can potentially trigger a slide towards Rs 860 - with interim support seen around RS 940 levels. CLICK HERE FOR THE CHART

Tata Power

Current Price: Rs 416

Upside Potential: 10.6%

Support: Rs 410; Rs 398

Post consolidating for a major part of February, Tata Power now seems poised to log fresh gains with select momentum oscillators turning favourable on the daily scale, the MACD and DI (Directional Index) in particular.

Charts suggest that the short-term bias for the stock is likely to remain positive as long as it trades above Rs 398. Near support for the stock is visible at Rs 410. On the upside the stock can potentially rally to Rs 460 levels. CLICK HERE FOR THE CHART

Indian Hotels

Current Price: Rs 584

Bias: Range-bound

Resistance: Rs 603; Rs 625

Support: Rs 568; Rs 540

After scaling a high of Rs 603 in mid-February, Indian Hotels has consolidated in the following three weeks amid which the stock has tested support around its 20-DMA (Daily Moving Average) on two occasions. The near-term bias for the stock is expected to remain positive as long as the stock holds above Rs 568. 

However, the upside too seems capped around Rs 603 levels for now. The stock may see a fresh directional move after break of the existing trading range of Rs 568-603. In case of an upward breakout, the stock can potentially jump to Rs 625-odd levels, whereas in case of a downside breakdown the stock can dip to Rs 540-odd levels. CLICK HERE FOR THE CHART