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Tata Power (₹229.9): SELL

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The short-term outlook for the stock of Tata Power is bearish. It tumbled 6.24 per cent on Monday. This sharp fall has dragged the stock well below the 100-day moving average (DMA) is currently at ₹237. The 21-week moving average resistance at ₹239. So any intermediate bounce is to be capped at ₹237-₹239. Fresh sellers are likely to come in at higher levels. Monday’s fallmarks the end of the sideways consolidation that was in place for two weeks. As such it indicates the beginning of a fresh leg of fall within the overall downtrend that has been in place since the first week of April.

There is room for a further fall to ₹206-₹204 over the next two-three weeks. Traders with a short-term perspective can go short at current levels. Accumulate shorts on a rise at ₹235. Keep the stop-loss at ₹243. Trail the stop-loss down to ₹226 as soon as the stock falls to ₹219. Move the stop-loss further down to ₹217 as soon as the stock touches ₹211.  Book profits at ₹208. The stock has to breach ₹239 decisively in order to become bullish. But that looks unlikely.

(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)

Published on May 10, 2022

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