Birlasoft (₹617.9)

Likely to recover

Birlasoft’s stock has been steadily declining since February after it faced a resistance at around ₹850. But after hitting a six-month low of ₹564.75 a couple of weeks ago, the stock appears to be stabilising. A morning star candlestick pattern can be observed on the daily chart. This is an indication of a bullish trend reversal. Also, ₹575 is a long-term support.

Hence the chances for the stock to begin a fresh rally is high. So, traders can buy now at ₹618. Buy more shares if the price dips to ₹590. Place initial stop-loss at ₹550. When the stock rises past ₹680, alter the stop-loss to ₹625. When the price touches ₹800, tighten the stop-loss further to ₹730. Liquidate the longs at ₹850.

General Insurance Corporation of India (₹369.2)

Breaks out of a range

The stock of General Insurance Corporation of India has been charting a sideways trend since early March. It was oscillating between ₹315 and ₹360. But last week, the scrip broke out of the resistance at ₹360, increasing the probability of a rally from here. On the chart, the nearest notable resistance is at ₹440. 

The price could soften to ₹340 before the stock surpasses ₹400 from here. Therefore, one can buy this stock at the current level of ₹370. Accumulate if the price dips to ₹340. Keep an initial stop-loss at ₹300. When the stock moves above ₹400, trail the stop-loss to ₹370. Tighten the stop-loss further to ₹390 when the price hits ₹420. Book profits at ₹440.

Prism Johnson (₹149.3)

At a crucial demand zone

Prism Johnson’s stock, which has been in a long-term uptrend, has seen its price drop this year. Year-to-date, the scrip has depreciated nearly 20 per cent. But the long-term chart shows that the stock has a strong support at ₹140, where a rising trendline coincides. So, the price band between ₹135 and ₹140 is a potential demand zone. On the upside, Prism Johnson’s stock can appreciate to retest ₹190 over the medium term.

So, one can go long on this stock now at around ₹150. Buy more shares if the price moderates to ₹140. Place stop-loss at ₹130. When the stock rises above ₹160, alter the stop-loss to ₹145. When the price hits ₹175, move the stop-loss further up to ₹160. Exit at ₹190.

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