HCL Technologies

We recommend a sell in HCL Technologies for investors with a short-term horizon. It is apparent from the charts of HCL Technologies that it has been on a medium-term downtrend from its September peak of Rs 261, forming lower peaks and lower troughs. Moreover, the long-term trend also is downwards for the stock from its June 2007 high of Rs 365.

The downtrend has accelerated this September. The stock breached its 21- and 50-day moving averages by tumbling in late September and it is trading well below them now. The daily relative strength index (RSI) has re-entered into the bearish zone and weekly RSI is featuring in this zone.

The weekly moving average convergence and divergence is steadily declining in line with the stock price. Considering that the medium-term down trendline continues to be intact, we are bearish on the stock from a short-term perspective.

We expect the stock to decline further until it hits our price target of Rs 120 in the approaching trading sessions. Traders with short-term perspective can sell the stock while maintaining a stop-loss at Rs 143.