In fact, we will not be surprised to see this sturdy wall getting demolished quite soon to extend the relief move towards 11,350 – 11,475. On the lower side, immediate supports are placed at 10,867 – 10,816 but the validity of above mentioned pointers remains intact as long as key support of 10746 – 10637 remains defended successfully.
All the above mentioned hypothesis as of now is based on various assumptions but we hope for it to turn into a reality which will bring back wider smile on faces of traders/ investors across the country who are desperate for some revival.
Of late, in the initial part of the correction, the stock did not move as per our expectations but now the way it’s shaped up, things look a bit encouraging. Also, the entire metal space has shown life in the week gone by after easing off some developments on the global front; augurs well for the counter. Technically speaking, after consolidating around its multi-year lows, stock managed to traverse its daily ’20-EMA’ for the first time in last two months. This resulted into a confirmation of ‘Dragonfly Doji’ pattern on weekly chart. We recommend buying this counter for a target of Rs.388 over the next few days. The stop loss should be fixed at Rs.337.
Along with the metal universe, the entire ‘Auto and Auto-ancillary’ seems to be gearing up for some relief. Although, it has done well in last couple of weeks, this counter was lagging a bit and now in last couple of days, it is trying to catch up with its peers. On the daily chart, stock is on the cusp of breaking the daily ’20-EMA’ and looking at the rising values of oscillators, we expect it to happen in the forthcoming week. Since it has not done much in the recent past, we expect the relief rally to be sharper in nature. Going with all the above evidence we recommend buying this stock at current levels for a target of Rs.426 over the next few days. The stop loss can be placed at 375.
Disclaimer: The views expressed are the author's own. He may have positions in one or all of the above mentioned stocks.