Here are the answers to readers’ queries on the performance of their stock holdings.
I bought Coal India at ₹292. The stock is in a downtrend. Shall I hold or book loss and exit?
Krishna Mohan
Coal India (₹174.7) : The stock of Coal India is in a downtrend across all-time-frames — short, medium and long term.
In June 2019, the stock encountered a key resistance at ₹270 and resumed its long-term downtrend. Since then, it has been in a medium-term downtrend.
A significant resistance at around ₹215 capped the stock’s upside in early November last year and again in early January this year; thereafter the stock continued to trend downwards.
Also, the short-term trend has been down since early January this year. The stock recorded a new low at ₹171 on February 1, and trades just above this level. It currently tests a vital support in the band between ₹171 and ₹180.
A decisive break below ₹171 can drag the stock down to ₹160 and then to ₹150 in the short-to- medium term. On the other hand, an upward reversal from the current support zone can take the stock higher to ₹200.
A strong break above this level is needed to alter the short-term downtrend and take the stock higher to ₹210 and then to ₹220 levels. To alter the medium-term downtrend, the stock needs to emphatically break above a key resistance level of ₹235.
Such a break-out can push the stock northwards to ₹250 and then to ₹270 in the long run. You can stay invested and average the stock on a decisive rally above ₹200 with a long-term stop-loss at ₹170. Consider exiting either at ₹250 or ₹270 levels.
What are the prospects of Mahanagar Gas?
Pradeep Kabra
Mahanagar Gas (₹1,160): A significant support at around ₹750 provided base for the stock of Mahanagar Gas in July 2019. The stock subsequently resumed its uptrend, and has been in an intermediate-term uptrend since then.
Medium- as well as short-term trends are also up for the stock. Nevertheless, the stock encountered a key resistance at ₹1,245 levels early February this year and stared to move sideways with a downward bias. Both the daily and the weekly relative strength indices are displaying negative divergence, indicating that a potential trend-reversal is on the cards.
The stock now hovers above a support at ₹1,150 levels. A decisive plunge below this base can drag the stock down to ₹1,100.
A further fall below ₹1,100 will mar the short-term uptrend and pull the stock lower to ₹1,000.
The subsequent supports are at ₹950 and ₹900. The intermediate-term uptrend will be altered if the stock slumps below ₹900. In that case, the stock can decline to ₹840 and then to ₹750 levels over the long term.
Conversely, if the stock breaks above ₹1,250 levels, it would appear resumption of the uptrend and push the stock higher to ₹1,300 and then to ₹1,350 levels.
Consider buying the stock at lower levels with a stop-loss at ₹950.
Send your queries to techtrail@thehindu.co.in
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.