Stocks to avoid; Colgate, IEX, Akzo Nobel look technically weak: Analyst

Colgate-Palmolive has broken below a rising trendline support and continues to trade below key moving averages, indicating a weak structure, says Kunal Kamble of Bonanza.

Equity markets have witnessed a downward pressure in March thus far amid the US-Israel-Iran war. The West Asia war has dampened the overall sentiment with higher crude oil prices stoking inflation fears and its impact on global economic growth.  Amid the downturn, around 1 in every 5 Nifty 500 stock has declined more than 10 per cent so far this month. A technical scan of the Nifty 500 shares shows that a total of 360 (72 per cent) stocks were quoting below their respective long-term 200-day moving averages (200-DMA).  In technical terms, the 200-DMA helps in determining bullish and bearish stocks. In general, stocks traded above the long-term average are said to be holding a positive trend and vice versa.  Given this background, Kunal Kamble, Sr. Technical Research Analyst at Bonanza helps identify three stocks are look unfavourably placed on the charts, and should be avoided in the current market set-up. 

Technical outlook: Stocks to avoid by Kunal Kamble

  Colgate-Palmolive (India)

Current Market Price: ₹2,090 

 

 

  The stock has broken below a rising trendline support and continues to trade below key moving averages, indicating a weak structure, says Kunal Kamble of Bonanza.  The analyst flags immediate support for Colgate around ₹2,090–2,100, while a decisive break could extend the decline towards ₹2,050 levels. On the upside, Kamble sees ₹2,240 as the key resistance zone. 

Akzo Nobel India Limited

Current Market Price: ₹2,870 

 

  Akzo Nobel remains in a clear lower-high, lower-low formation with persistent selling pressure, highlights the analyst from Bonanza.  "Immediate support for the stock is seen around ₹2,800, while a breakdown could push the stock towards ₹2,700 – ₹2,650. Any pullback is likely to face resistance near ₹3,000 – ₹3,050, keeping the broader bias weak," says Kamble. 

Indian Energy Exchange (IEX)

Current Market Price: ₹124 

 

  IEX continues to consolidate near its lows while trading well below long-term moving averages, indicating weak momentum, says Kamble.  The analyst sees immediate support for the stock near ₹120, and cautions that a breach could open downside towards ₹110 – ₹105 levels. On the upside, he expects ₹128 – ₹130 to act as a key resistance zone. This translates into a 15 per cent downside risk form current levels.  Disclaimer: The views expressed by the brokerage/ analyst in this article are their own and not those of the website or its management. Business Standard advises users to check with certified experts before taking any investment decisions.