The short-term outlook for the stock of Can Fin Homes is bearish. The stock has been volatile this week moving sharply up one day and down the other day with high volumes. It has tumbled over 10 per cent in the last couple of days. This has taken it decisively below the 200-Day Moving Average (DMA). Broadly the stock range bound between ₹520 and ₹675. Within this it come down ₹520 – the lower end of the range in the next few days, if the downward momentum continues. Immediate resistance will be at ₹590 and the next higher one will be at ₹605.
Traders can go short now and accumulate on a rise at ₹586. Keep the stop-loss at ₹607. Trail the stop-loss down to ₹568 as soon as the stock falls to ₹555. Move the stop-loss further down to ₹545 as soon as the stock touches ₹535 on the downside. Book profits at ₹527. Since the stock has been oscillating in a range, exit the shorts at the above-mentioned level rather than anticipating for a break below ₹520. The price action around ₹520 can be watched and then fresh trades can be taken accordingly.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)