The Hindu Business Line : Moderate upside in pivotal stocks

SBI (Rs 887): The stock ruled weak and also dropped to the target zone of Rs 845-850. The recent price pattern does not indicate the completion of the downtrend. Yet another test of the support zone at Rs 845-850 appears likely. Investors willing to take risk may consider short positions on evidence of weakness at the resistance zone at the Rs 905-910 range. The stop-loss for short positions may be placed at Rs 915. A close above Rs 915 would help the stock move to the next resistance level at the Rs 935-940 band. Remain invested with a stop-loss at Rs 860 and use a trailing stop-loss in the event of a rally. Fresh exposures may be considered on weakness.

Reliance Inds (Rs 770): A bearish trend prevailed and the stock dropped to the target zone of Rs 745-750. The near-term trend appears positive and a move to Rs 795-800 may materialise. The trend would remain positive as long as the stock holds above the crucial support level at Rs 735. A close below this level would result in the completion of a bearish "head and shoulder" pattern that could push the stock to the Rs 685-690 band. Traders may go long with a stop-loss at Rs 750. At least partial profit booking may be considered on a move to the target zone.

Tata Steel (Rs 368): The stock failed to move past the positive trigger level of Rs 388. This effectively negated last week's expectations of a rally to Rs 397-400. The slide in price over the past few days has pushed the stock deeper into the oversold zone. The price action on Friday tends to confirm the possibility of a short-term pull back. A move to Rs 380-385 appears likely. Hold with a stop-loss at Rs 355. Fresh exposures may be avoided.

Satyam Computer (Rs 594): The share price ruled weak and also moved to the target zone at Rs 535-540. The near-term trend is positive and a rally to Rs 610-615 appears likely. Remain invested with a stop-loss at Rs 575. Fresh exposures may be avoided while shareholders may use a trailing stop-loss if the stock moves past the target zone.

Infosys (Rs 2552): The price movement was in alignment with last week's expectations. The stock ruled weak and dropped to the target zone of the Rs 2440-2450 range. The near-term outlook is positive and a move to the Rs 2620-2650 range appears likely. Hold with a stop-loss at Rs 2490. Fresh exposures may be deferred.

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Arvind Mills (Rs 119): The price movement in the stock was in sync with last week's expectations. The stock ruled weak as anticipated, and moved closer to the target zone of the Rs 95-100 band. After touching a low of Rs 110, the stock recovered ground on Friday. The downward move does not appear complete. The stock appears to be on course to move to the target zone of Rs 95-100 that was mentioned earlier. This view would be negated only on a weekly close above Rs 136. Investors may hold with a stop-loss at Rs 109 and reduce exposures on strength. The stock is likely to face resistance at Rs 128-130. Fresh short positions may be considered on evidence of resistance at this zone with stop-loss at Rs 136.

Karnataka Bank (Rs 96): Contrary to expectations, the stock ruled weak. The breach of the stop-loss level at Rs 105 effectively negated the short-term bullish outlook. As anticipated, the stock turned bearish on the breach of the stop-loss level at Rs 105. It went on to touch a low of Rs 91.5 on Friday before recovering to close at Rs 96. Though the breach of the stop-loss level had negated the short-term positive outlook, we still favour the case for a move to the Rs 140-145 range. Contrary to our expectation of a sideways correction, the stock mapped out traced out a sharper retracement. This has just delayed the recovery process towards the target zone. Shareholders may remain invested with stop-loss at Rs 89. Fresh exposures may also be considered with stop-loss at Rs 89.

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