Investors with a short-term perspective can consider selling Tata Motors – DVR at current levels. The stock encountered a key resistance at Rs.380 in September 2014. Since then, it was on a sideways consolidation phase in a broad band between Rs.300 and Rs.380. Testing the upper boundary in January and again in February, the stock failed to surpass it, and has been on a medium-term downtrend. It breached the 50- and 200-day moving averages in mid-April and currently trades well below these levels. The short-term trend is also down for the stock.
On Monday, the stock tumbled 3 per cent with above average volume, decisively breaching the lower boundary of the sideways range as well as a key support at Rs.300. Both the daily and weekly price rate of change indicators are hovering in the negative terrain indicating selling interest. It can decline further to Rs.280 and then to Rs.273 in the upcoming sessions. Sell the stock with a stop-loss at Rs.297.5.
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