Bharti Airtel (Rs 278.8)
Bharti Airtel gave investors the jitters last week as it turned tail following the announcement of its offer to buy the African operations of Kuwait telecommunications company, Zain. The stock lost 14 per cent in the first two sessions of the week as it plunged to the low of Rs 269.3.
The stock is in an intermediate-
Long-term investors can therefore utilise declines to the zone between Rs 230 and Rs 270 to accumulate the stock with stop at Rs 220. The stock could however remain choppy in the near-term and a close above Rs 300 is needed to signal that it is on a path of sustainable recovery.
Reliance Industries (Rs 983.2)
It is very hard to keep Reliance Industries away from the thick of the action and the stock led the market lower in the last two sessions on concern that its bid to buy LyondellBasell Industries may have to be raised. The steep plunge from the intra-week peak of Rs 1,038.3 on Thursday denotes that the medium-term trend in the stock continues to be down since the peak formed on January 15.
Another rebound from Rs 975 level will keep the stock volatile in the range between Rs 975 and Rs 1,040 in the budget week. Investors should however exercise caution as long as it trades below Rs 1,040. Targets on a decline below Rs 975 are Rs 936 and Rs 874.
As indicated earlier in our 'pivotals' column the medium-term boundaries for this stock are Rs 850 and Rs 1,200. Investors can start bottom fishing in the band between Rs 850 and Rs 900.
Hindalco Industries (Rs 149.9)
This stock soared merrily in the first half of the week after its North American unit Novelis returned to profit in the third quarter. The stock jumped to an intra-week peak of Rs 154.8 before giving up some gains towards the weekend.
Hindalco retraced 33 per cent of the up-move recorded in 2009 when it declined to the recent low of Rs 133.5. That meets the minimum decline required for a correction. There is another strong support just below at Rs 125 where the 200-day exponential moving average is also positioned. Investors can therefore accumulate the stock in declines with stop at Rs 120. Fresh purchases should however to be avoided on a fall below Rs 120 since subsequent supports are Rs 108 and Rs 91.
Short-term resistances are at Rs 163 and Rs 180 and investors with a trading perspective can take some money off the table at these levels. Reversal from either of these levels can result in the stock moving in a range between Rs 125 and Rs 180 for a month or two before moving higher. Our positive view on this stock will be negated only on a close below Rs 120.
NMDC (Rs 457.6)
NMDC has also been in the news for its upcoming FPO and proposed change in pricing structure. The stock had been witnessing sharp spikes and equally severe declines over the last two weeks. Immediate supports for the stock are at Rs 440, Rs 427 and Rs 393. Short-term investors should divest their holding on a decline below Rs 440.
Investors with a medium-term perspective can hold the stock as long as it trades above Rs 400. The current decline can halt around Rs 400 that also occurs at 38.2 per cent retracement of the up-move from November 2008 low.
Coromandel International (Rs 275.2)
Fertiliser stocks were a buzz last week as Government hiked urea prices and approved a plan to pay subsidies to these companies based on nutrient content. Coromandel International rallied 13 per cent to the peak of Rs 289 on Friday before giving up some gains. The stock has long-term support in the zone between Rs 200 and Rs 230 and this zone can support the stock in declines. Investors with medium-term perspective can therefore hold the stock as long as it holds above Rs 200. Short-term support and resistance is at Rs 250 and Rs 295 respectively. — Lokeshwarri S.K
Happy Trading,
United we grow!!!
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