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Tata Steel has moved past its crucial resistance level of ₹250 and has made a strong weekly close above it for two consecutive weeks. A double bottom on the weekly chart, a strong break above the long-term down trendline and the 21-week moving average resistances signal that the stock could have found a bottom.
This implies that the long-term downtrend that has been in place since August 2014 may get reversed. There is no immediate threat for the stock to fall as long it trades above ₹250.
Further rise and a decisive weekly close above ₹270 will confirm the trend reversal. For the week, significant support is at ₹255. Short-term traders can go long with a stop-loss at ₹254 for the target of ₹273. Investors with a medium-term perspective can hold their long positions with a wider stop-loss at ₹248.
Accumulate long positions on dips to ₹255 and ₹250.
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