Jaiprakash Hydro Power

We recommend a sell in the Jaiprakash Hydro Power stock from a short-term trading perspective. It is apparent from the charts of Jaiprakash Hydro that since March low of Rs 24, it has been on an intermediate-term up-trend. The up-trend accelerated, penetrating key resistance levels at Rs 60 and Rs 75 during May.

However, the stock encountered resistance around Rs 100 in early June and changed its trend. On June 8, the stock tumbled 9 per cent experiencing selling interest and formed a bearish engulfing candlestick pattern, which is a short-term bearish reversal pattern. Both daily and weekly relative strength indices began to decline after reaching the overbought territory.

The price rate of change indicator is also declining from the overbought levels. We take a contrarian view on the stock from a short-term horizon and expect it to decline further until it hits our price target of Rs 78 in the upcoming trading sessions. Traders with short-term perspective can sell the stock while maintaining a stop-loss at Rs 91.5.

via BL