Last close: 7,831
After correcting sharply from 8,340 levels, nifty tested the levels of 7700 in single downswing. From past few days, Nifty is consolidating in the range of 7,700-7,900 levels with negative bias. Considering all, Nifty is likely to form “Head and Shoulder” pattern on daily charts, which is bearish in nature. Although we don’t have the neckline breakdown of same but its consolidation indicates that there will be a major downside from current levels. So any breakdown of 7700 levels can open the door for further downside by 7,540 levels. On the higher side, any breakout of 7,950 can give the decent upside upto 8,100 levels.
CASTROL INDIA (SELL)
Last close: Rs 435.50
Target: Rs 421-415
As per the daily chart, stock is forming head and shoulder pattern, which is considered to be bearish. On Tuesday, stock went down by over 1% and gave the neckline breakdown of pattern. So, one can initiate short for the downside target of Rs 421-415 levels with a stop loss of above Rs 442.
CROMPTON GREAVES (LONG)
Last close: Rs 196.70
Target: Rs 203-205
On broader charts, stock was trading in the stiff range of 155-195 levels from past few months and gave the breakout of same by registered gains over 2.5% on Tuesday. So more buying is anticipating from current levels. Therefore, one can buy for the upside target of Rs 203-205 levels with a stop loss of below Rs 193.
Last close: Rs 810.15
Target: Rs 830-840
Short term and medium term bias remains positive for the stock. It is trading in the range of 750-800 levels from past few weeks with positive bias. On Tuesday, stock has given the breakout of same by registered gains over 1.5% so we anticipate that buying may continue for near term. One can buy for the upside target of Rs 830-840 levels with a stop loss of below Rs 798.
We may or may not have positions in the above stocks discussed.
Mudit Goyal is a technical analyst with SMC Global Securities Limited