Nestle stock attempts breakout above 200-DMA; is the consolidation over?

Apart from testing the 200-DMA, Nestle has also retraced 38.2% of the recent fall. Chart shows key hurdle for the stock at ₹ 2,400 levels; here are the other key levels to track.

Nestle stock is seen attempting a breakout from its six-month long consolidation zone, as it tests its 200-Day Simple Moving Average (200-DSMA) after October 2024. The stock had broadly consolidated in the ₹ 2,100 - ₹ 2,300 range for most part of the last six months.  In the last two trading sessions, Nestle has been hovering around its 200-DSMA, more commonly known as 200-DMA, which stands at ₹ 2,348.  Can the stock finally break-free? Here’s what the chart indicates. 

Nestle India

  Current Price: ₹ 2,352  Upside Potential: 13.6%  Downside Risk: 14.9%  Support: ₹ 2,270; ₹ 2,215; ₹ 2,100  Resistance: ₹ 2,400; ₹ 2,430; ₹ 2,508; ₹ 2,616  Nestle stock has rallied nearly 12 per cent from its recent low around ₹ 2,100 levels; whereas the stock had tumbled by almost 24 per cent from its high of ₹ 2,670 in September 2024. At present, as the stock tests the 200-DMA, it has also retraced 38.2 per cent of its preceding fall. Thus, sustenance above the 200-DMA is the key for the further gains on the stock. CLICK HERE FOR THE CHART  As per the Fibonacci levels, the 38.2 per cent retracement stands at ₹ 2,352; above which the stock can potentially extend the pullback towards the next key rations at 50 per cent, 61.8 per cent and 78.2 per cent. This implies a potential upside target of ₹ 2,430, ₹ 2,508 and ₹ 2,616, respectively.    Technically, the price-to-moving averages action indicates a mixed outlook for even as the 20-DMA has now crossed the 50- and 100-DMAs; all three shorter-term moving averages are still languishing below the long-term 200-DMA. That apart, the upside for the stock seems capped around ₹ 2,400 levels as per the weekly chart. Chart suggests that Nestle needs to break and trade consistently above ₹ 2,400 for the sentiment to turn favourable at the counter. Post which, the stock can rally towards ₹ 2,670 levels.  On the downside, the ₹ 2,100 level remains the major support, as it now coincides with the 100-Week Moving Average (100-WMA) - a key indicator the stock has respected since April 2016. Near support for the stock can be anticipated around ₹ 2,270 and ₹ 2,215 levels. The long-term chart shows that break and trade below ₹ 2,100, can trigger a fall towards the psychological ₹ 2,000-mark.