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B. Krishnakumar

Finolex Industries (Rs 79.2): The stock was stuck in a trading range in the recent weeks. A perceptible contraction in volatility is evident from the intertwining of the short-, medium- and long-term moving averages.

Typically, such a narrow price action would be followed by a sharp move. The stock appears to be bracing for a strong move up, if the price action in the last couple of days is any indication. The pick-up in volume and a surge in price indicate that the stock could move to the immediate target zone at the Rs 88-90 range.

Shareholders may consider partial profit booking if the stock faces resistance at the Rs 88-90 band. Fresh exposures may be considered on the price weakness with a stop-loss at Rs 68. Holders of long positions may have the stop-loss at Rs 68.

Bombay Dyeing (Rs 343.6): The long-term outlook is bullish. A close above the immediate resistance level at Rs 363 would impart strength. On the contrary, a drop below Rs 325 would push the stock to the Rs 290-300 range. Long-term investors may hold with a stop-loss at Rs 324.

Short-term traders may consider long positions with a stop-loss at Rs 325 and a price objective of Rs 362. Either a portion of the holdings may be sold on the evidence of resistance at Rs 362 or a trailing stop-loss may be used instead to protect unrealised gains. Price weakness may be used to add exposures with a stop-loss at Rs 325.

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