The stock of Titan Company met with a key resistance at Rs.390 in late November after retracing 61.8 per cent fibonacci retracement level of its prior downtrend. It subsequently changed direction and started to decline. Since then, the stock has been on a short-term downtrend.
Currently, it is poised at a key medium-term trend-deciding level of Rs.340. A decisive fall below Rs.340 can drag the stock down to the key long-term support zone between Rs.300 and Rs.310 in the coming weeks.
But an upward reversal from the current level can take it higher to Rs.365 and Rs.390 in the medium term. Nevertheless, to alter the intermediate-term downtrend, the stock needs to emphatically break through the crucial resistance level of Rs.390.
This will strengthen the stock’s long-term uptrend and take it up to Rs.415 or Rs.440 in the long run.
Investors with a long-term perspective can average the stock at lower level around Rs.300 with a stop-loss at Rs.285.
Inability to break through and rally above the resistance level of Rs.390 will be a cue for taking profits off the table at that juncture.
On the other hand, a decisive fall below the key base at Rs.300 can pull the stock down to next supports at Rs.265 and Rs.250 levels.