Stocks testing support . . !

L&T, Reliance and State Bank are trading very close to their supportgiving the very close stoploss (ie low risk to return proposition)

L&T :
645 should be ultimate support (Hence StopLoss)
Target : 820

Reliance :
1040 Should be ultimate support (Hence StopLoss)
Target 1300

State Bank:
1000 Should be ultimate support (Hence StopLoss)
Targets: 1150, 1400, 1500

6 comments:

Murtaza Attari said...

But do you think the mkt is strong enough to bounce back that sharply or rather the stocks so strong so as to take the market higher?

SBI, LT and RIL are all hammered stocks and recently in the last 10 days no buying seen i.e. volumes were low.

I would much be looking lower i.e. short and cover at the SL levels - what say?

Murtaza

yndesai said...

These stocks below the shown line means more downtrend in the NIFTY/SENSEX. . .

I can not be very sure if they will bounce back or not but since they are very close to their support one can build position with StopLoss.

With stoploss in place such proposal is worth looking at. Even if one is stopped out the loss would be very minimal.

yndesai said...

By any means these are critical levels and these stocks are not going to wait at these levels for long.

So if you hit the stoploss go short. . .

FUNZONE said...

As far as i have studied in TA, all these stocks are in descending triangle. Since this triangle is formed during fall of the stocks, the chance of breakdown, therefore break of supports is more. So i think we should be catious here.

yndesai said...

Funzone;
Thanks for the question.

My trading stretagy is if the support is intact be bullish. If there is definate indiacation of break of support by close below the suppot then only become bear.

So take position based on EVENT not on prediction. Hence the knowledge of such levels helps.

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