Lacklusture trend in key pivotals

B. Krishnakumar

ITC (Rs.686.05): As mentioned last week, the share price of ITC appears to be headed towards the support area at the Rs.630-635 area.

The short term outlook continues to remain weak. Fresh buying may be avoided for the time being while aggressive traders could take short positions with a stop at Rs.700. A decline below Rs.670 could be used to enhance short positions in ITC. Long term investors could take long positions on evidence of support at around the Rs.630 area.

Hindustan Lever (Rs.216.4): The share price of the company is yet to break out of the recent trading range. An explosive move would follow once the scrip breaks out of the ongoing trading range. As observed last week, a move past Rs.224 would impart short term uptrend. On the other hand, a decline below Rs.208 would result in a short term down move in Hindustan Lever. Given this backdrop, it would be safer to take trading positions after there is a decisive break out from the present trading range.

Infosys Technologies (Rs.4161.95): Contrary to expectations, the share price of the company ruled weak. Though the support at Rs.4100 level was not breached last week, the outlook for the stock is still weak. Only a move past Rs.4700 would impart positive trend in Infosys. On the downside, a decline below Rs.4100 would push the scrip to the Rs.3650-3750 area. However in the slightly longer time frame, the outlook for Infosys continues to remain positive. A rally towards the price target of Rs.5200-5300 is still on the cards.

Satyam Computers (Rs.245.5): Similar to Infosys, the expectation of a firm trend turned out to be incorrect. The decline below the support area at Rs.245 has imparted negative outlook for Satyam. As of now, a break below Rs.220 could push the scrip towards the Rs.190-195 area. On the other hand, only a rise above Rs.280 would reinstate positive trend in Satyam.

(Note: This column analyses the outlook for major Nifty constituents based entirely on Technical Analysis of the past price behaviour of the company concerned. There is a risk of loss in trading.)