Investors with a short-term perspective can consider selling the shares of Sundaram Brake Linings. The stock fell for the third consecutive trading day and closed 2.4 per cent lower on Wednesday. It has been consolidating sideways between ₹260 and ₹300 since June. The 100-day moving average had been restricting the stock over the short-term.
The stock broke the lower boundary of this range decisively last week. It has also declined below the 100-week moving average at ₹259 that had been providing strong support since June. The range break out marks the resumption of the medium-term downtrend that has been in place since January.
Immediate resistance is at ₹228 and the outlook is bearish. A fall to test the next support at ₹214 is possible now. Traders with a short-term perspective can go short. Stop-loss can be placed at ₹228 for the target of ₹214.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)