The stock of Coromandel International fell 3.5 per cent on Tuesday, decisively breaking through a key support level at Rs.230. Investors with a short term view can sell the stock at current levels. The stock has a significant long-term resistance in the Rs.340 and Rs.350 band. After hitting this resistance band in November 2014, the stock reversed direction and started declining. Since then, it has been in an intermediate-term downtrend. The stock was moving sideways with the help of the key support at Rs.230, but that level has now been breached.
The stock trades well below its 50- and 200-day moving averages. The daily relative strength index has re-entered the bearish zone from the neutral region. The breakthrough of key support levels leads to a bearish outlook on the stock. It can continue to decline and reach the price target of Rs.211 and Rs.207 in the ensuing trading sessions. Sell the stock with a stop-loss at Rs.225.
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