Godfrey Phillips (₹1,732.6)
Signs of bulls coming in
The stock of Godfrey Phillips has been depreciating over the past month. However, in the last two weeks, the selling pressure has waned. In fact, the candlesticks of the last two weeks hint at good buying in the ₹1,660-1,725 range. The stock had earlier seen a sharp rise in December last year once taking support from the same ₹1,660-1,725 range. This indicates that this is a demand zone.
Hence, we anticipate a bounce from here leading to a retest of the ₹2,000-mark. So, one can go long on the stock now at around ₹1,732. Accumulate more shares if the price falls to ₹1,680. Place stop-loss at ₹1,615. When the stock rallies past ₹1,870, modify the stop-loss to ₹1,800. Liquidate the longs at ₹2,000. Since the recent trend has been bearish, this trade is slightly riskier.
HDFC Life (₹483)
Resumes downtrend
The stock of HDFC Life Insurance Company witnessed a corrective rally two weeks ago. This was capped by the barrier at ₹525 from where it has fallen to the current level of ₹483. Therefore, the stock seems to have resumed the downtrend. Going ahead, the probability of a further fall looks high. The nearest support is at ₹428 and the subsequent one is at ₹405.
Given the current downward momentum, we forecast the stock to fall to ₹405 in the short term. Traders can consider initiating fresh shorts now at ₹483. Add more shorts if the price rises to ₹510. Keep initial stop-loss at ₹535. On a fall below ₹450, revise the stop-loss to ₹485. Tighten the stop-loss further to ₹450 when price declines to ₹428. Exit at ₹405.
Hindalco Industries (₹415.2)
Breaches a support
The stock of Hindalco Industries was moving in a narrow range of ₹426-440 over the past couple of weeks. But on Friday, it breached the support at ₹426 and slipped below a rising trendline support. This hints at a change in the short-term trend to bearish. We expect the stock to fall further from here. While ₹386 is a minor support, the price is likely to drop to ₹360 over the next two or three months.
The price action on the daily chart resembles a confirmed bear flag pattern indicating that the fall could be sharp. So, traders can short the stock at the current level of ₹415 with stop-loss at ₹450. Bring the stop-loss down to ₹400 when the stock falls to ₹386. Book profits at ₹360.