Technical Portfolio Guide

CMP: Rs.336.35 BSE Code: 500547

I am planning to add BPCL to my portfolio from a medium-term perspective. Kindly provide technical inputs for the stock.
- Mahesh G

AVOID BPCL FOR NOW

BPCL is currently trading at Rs 336.35. Its 52-week high/low stand at Rs 551.55/Rs 303.85 made on October 30, 2017 and October 04, 2018, respectively. The stock has been trading below its crucial moving average i.e. 100-DMA and 200-DMA. Technically, the stock has resistance placed around the level of Rs 392-393 defined by the downward sloping trendline drawn adjoining March 2018 and June 2018 highs. We would advise to wait for the stock to give a breakout of the downward sloping trendline to enter this stock. A close above the downward sloping trendline may take it towards its 200-DMA, which is currently placed at the level of Rs 419. The RSI on the daily time frame is not able to cross the level of 60-61. 

MERCK

CMP: Rs.2799.95 BSE Code: 500126

I have purchased stocks of Merck at an average price of Rs 1940. Since the market is correcting heavily, I want to know how this stock will fare in the short-medium term? - Apoorva Shah

HOLD MERCK WITH STOP LOSS OF RS 2480

Merck is currently trading at Rs 2799.95. Its 52-week high/low stand at Rs 3554.40/Rs 1015.50 made on September 3, 2018 and October 17, 2017, respectively. The stock after registering its 52-week high entered into a corrective phase, where the stock took support around its 100-DMA and witnessed a good bounce-back from its 100-DMA, despite the correction in the market. Going forward, the zone of Rs 2480-2540 is a crucial support area for the stock as it is the confluence of 100-DMA, which is currently placed at levels of Rs 2540, and the 78.6 per cent retracement level of rally from August to September (2195-3554.40). The stock may find resistance around the level of Rs 3000 as defined by the channel pattern; however, closing above this pattern would infuse further bullishness and could take the stock towards its all-time high levels. Considering the above factors, we would advise you to hold the stock with stop loss of Rs 2480 for an immediate target of Rs 3000, followed by Rs 3550 in the medium term.

AMBUJA CEMENT

CMP: Rs.213.45 BSE Code: 500425

I’m holding the stock of Ambuja Cement bought at higher price and suffering a loss at present. Considering the sharp fall in the stock price and markets, should I average at the current levels? - Satish Kothari

AVOID AMBUJA CEMENT FOR NOW

Ambuja Cement is currently trading at Rs 213.45. Its 52-week high/low stand at Rs 288.65/Rs 189 made on October 31, 2017 and July 17, 2017, respectively. The stock after registering its 52-week high level formed lower peaks and lower troughs and made a low of Rs 189. However, post the low, the stock witnessed a decent rally and marked a high of around Rs 245 level and this turned out be a breather rally after a sharp fall and the stock continued its slide downwards. The stock is trading below its important moving averages, i.e. 100-DMA and 200-DMA, which is negative for the stock. The 14-period daily RSI is trading below its nine-day average and moving in a downward trajectory suggesting a negative bias. Considering the above factors, we would suggest you to avoid averaging in this stock at the current levels.

JUBILANT FOODWORKS

CMP: Rs.1126.25 BSE Code: 533155

I’m holding 200 shares of Jubilant Foodworks since past 2-3 years. Currently, the stock has witnessed correction from higher levels. Is this the time to take profits off the table? - Zaki Ahmad

BOOK PROFIT IN JUBILANT FOODWORKS

Jubilant Foodworks is currently trading at Rs 1126.25. Its 52-week high/low stand at Rs 1578/Rs 696.23 made on August 28, 2018 and October 4, 2017, respectively. The stock after registering its 52-week high witnessed breakdown from upward sloping trendline, and thereafter, it formed lower peaks and lower troughs and currently the stock is trading below its 100- DMA and 200-DMA. The stock has slipped below its crucial moving average for the first time since July, 2017, which is negative for the stock. On the weekly time frame, the stock has breached 50-period moving average. Thus, we would advise to book your profits in the stock.

L&T FINANCE HOLDINGS

CMP: Rs.126.20 BSE Code: 533519

I’m holding 350 shares of L&T Finance Holdings at an average price of Rs 155 at the current levels. I’m suffering a huge loss. Should I average by buying at the current levels? - Suman Kumar Singh

AVOID L&T FINANCE HOLDINGS FOR NOW

L&T Finance Holdings is currently trading at Rs 126.20. Its 52-week high/low stand at Rs 213.85/Rs 120.50 made on October 24, 2017 and September 25, 2018, respectively. The stock had witnessed a trendline breakout at the levels of Rs 174-178 around last week of July, and thereafter, the stock moved higher up to the levels of Rs 189-189.50. However, the stock faced resistance around the levels of Rs 189-189.50. After facing resistance around the mentioned level, the stock moved lower and breached its 50-period weekly moving average and entered into a sharp decline, and in no time, the stock breached its double bottom pattern, which was placed at Rs 140-145 and the selling pressure intensified. At the current juncture, it is not advisable to average this stock even though the oscillators on the daily as well as weekly time frame are in the oversold region, yet there is no reversal in sight. Hence, avoid averaging this stock at the current levels as per technical perspective.

DISH TV

CMP: Rs.55.20 BSE Code: 532839

Can I buy shares of Dish TV at the current levels?
- Vishal Bafna

AVOID DISH TV FOR NOW

Dish TV is currently trading at Rs 55.20. Its 52-week high/low stand at Rs 86.90/Rs 54.00made on January 9, 2018 and October 4, 2018, respectively. The stock had a strong support in the range of Rs 63.75-65 as defined by the horizontal trendline. The stock breached this crucial support in mid-August and witnessed sharp decline, and currently, the stock is trading near its 52-week lows. The stock is trading below its important averages, which is negative for the stock. Hence, we would advise to stay away from the stock as the technical picture is not rosy.

Disclaimer: 1) Some of the companies covered in this section do not have good volumes on the bourses. Technical analysis works much better in cases where volumes on the stock are high. Investors please take note of the same. 2) Recommendations in this section are purely based on Technical Analysis. FNIW may or may not look at the Fundamental Strength of the recommended stocks.