Today's Pick - Tata Chemicals

We recommend a sell in Tata Chemicals from a short-term perspective. It is evident from the charts of Tata Chemicals that it has been on a long-term up-trend from March 2007 trough of Rs 187. However, in the medium-term the stock has been on a strong downtrend since its life high of Rs 431 touched on January 3. Following a pullback rally form the support level of Rs 265, the stock halted at Rs 330 (key resistance level). On March 13, the stock plunged 8 per cent from the key resistance level of Rs 330, which indicates resumption of the medium-term downtrend. The stock is currently hovering near the 200-day moving average. The daily momentum indicator is declining in the neutral region towards the bearish zone. The daily moving average convergence divergence is featuring in the negative territory. Considering the strength of the medium-term downtrend, we expect the stock to penetrate the 200-day moving average as well as the long-term up trendline and decline to our target price level of Rs 265 in the coming trading sessions. Investors with a short-term perspective can sell the stock while keeping the stop loss at Rs 330.

Via Businessline