The stock of Crompton Greaves fell 3.7 per cent breaking through its key support at ₹166 on Thursday. It has plunged 14.8 per cent for the week, decisively breaching its moving average compression at around ₹190. Investors with a short-term perspective can sell the stock at current levels. Since registering a 52-week high at ₹231 in early September 2014, the stock has been on an intermediate-term downtrend. The stock appears to have resumed its intermediate-term downtrend. The relative strength index on the daily chart features in the bearish zone and backs the stock’s downtrend.
Both the daily and the weekly price rate of change indicators are hovering in the negative territory implying selling interest. The short-term outlook for the stock is bearish. It can extend the ongoing downtrend and reach our price target of ₹155 and ₹151.5 in the forthcoming sessions. Sell the stock with a stop-loss at ₹165.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)