Technical Portfolio Guide

Technical  Portfolio Guide

TATA STEEL LTD.
CMP: ₹ 1,122.85
BSE Code:500470 

Tata Steel has corrected lately. Is it good to buy at the current levels?
- Rant Dev

CONSIDER THIS STOCK ABOVE RS 1,335

The stock has formed a parallel bottom at Rs 1,060 levels. It bounced sharply during the week but ultimately, saw a major profit booking on Wednesday. The metal index, too, jumped over 6 per cent on Tuesday, raising the hopes for metal stocks but slumped on Wednesday. On the technical chart, the stock has formed lower highs & parallel bottoms, which is nothing but a bearish formation or descending triangle. On the weekly chart or a long-term chart, the structure is not convincing to buy for the long-term. A breakdown below the level of Rs 1,060 will result in a bigger fall. Even the relative strength is very poor at the current level. The weekly MACD indicates strong bearish momentum. Thus, the bounce cannot be trustworthy. Consider this stock only above Rs 1,335 for the long term. If you have a conviction, you can consider keeping the stop-loss at Rs 1,060.

GRASIM INDUSTRIES LTD.
CMP: ₹ 1,456.50
BSE Code:500300 

I am stuck with Grasim, which I bought for Rs 1,600. What should I do?
- Ajay Gupta

KEEP A STOP-LOSS AT RS 1,430
The stock has formed lower tops & lower bottoms and is in a downtrend. It formed parallel bottoms at the level of Rs 1,430, which were tested in the current week. It is trading below all key moving averages and has very poor relative price strength. The negative divergence in RSI has got the confirmation for bearish implications. The weekly MACD has declined below the zero line, and the histogram shows increased downside momentum. Your buy price is almost at the breakdown level. Keep a stop-loss at the level of Rs 1,430. In any case, if it closes above Rs 1,530, continue your position, which has a remote chance.

PIDILITE INDUSTRIES LTD.
CMP: ₹ 2,118.15
BSE Code:500331 

What is the best buying level of Pidilite for the short term?
- Archana Motiwala

AVOID THE STOCK FOR FRESH PURCHASE
The stock broke the Head & Shoulders pattern last week and is retesting the neckline this week. The 20-weekly moving averages are in a downtrend, and the stock is trading below all the key moving averages. As it declined over 17 per cent from its high, the relative strength is very poor. Though the volume is lower than average for the last two months, the price action is not convincingly attractive. The weekly RSI is in a clear downtrend and got the confirmation for a negative divergence. The MACD is below the zero line. The Elder impulse system has formed a series of bearish bars. The TSI and KST indicators are also in a bearish mode. Avoid this stock for a fresh purchase.

VAKRANGEE LIMITED
CMP: ₹ 30.85
BSE Code:511431

What is your view on Vakrangee?
- Chepyala Ramesh

AVOID THIS STOCK
This scam-hit stock declined more than 95 per cent from its top of Rs 516. For the last four years, it has been trading between Rs 15 and Rs 70. It is clearly in a downtrend. The weekly MACD has given a sell signal. The RSI is below 40, and none of the indicators shows strength in the stock. It has poor technical strength and poor fundamentals. There are ample superior stocks in the market to buy; hence, avoid this stock. 

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PEG ratio is a company’s price/earnings ratio divided by its earnings growth...