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Shares of Maruti Suzuki, the country's largest carmaker, broke support at Rs 7,398, and according to technicals, the stock may test Rs 7,068. The stock fell as much as 3.39 per cent to Rs 7,211.15 and broke a support at Rs 7,397.60.
The Rs 7,397.60 level is identified as the 38.2 per cent Fibonacci retracement level of the uptrend from February 29, 2016 low to December 20, 2017 high. This suggests that the stock may test a support at Rs 7,068.1, the 261.8 per cent Fibonacci projection level of the correction from the high of July 24 to the low of August 13(wave A).
The stock's wave pattern suggests it is in the final sub-wave of a three-wave correction and therefore the correction is expected to end within a couple of days, unless it turns out to be a more complex combination of corrective patterns.
MACD is negative and below its signal line, seen as unfavourable. Maruti Suzuki stock had fallen 23.3 per cent this year as of last close, while the broader NSE Index was up 4.54 per cent in the same period.
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