Bajaj Hindusthan

We recommend a sell in Bajaj Hindusthan from a short-term perspective. It is apparent from the charts that the stock bottomed in March around Rs 40. The uptrend accelerated in May and this rally prolonged until late June. However, after encountering resistance in the band of Rs 230 and 235, the stock reversed direction. Since then, the stock has been on a medium-term downtrend. After breaking through the key support level of Rs 200 (turned in to key resistance) in early June, the stock failed to surpasses this resistance level twice. Reinforcing the downtrend, the stock breached its 21- and 50-day moving averages recently. The daily relative strength index is declining towards the bearish zone and weekly RSI has slipped to the neutral region. Moreover, the daily moving average convergence and divergence indicator are signalling a sell and are hovering in the negative territory. We are bearish on the stock from a short-term perspective. We expect its decline to continue until it hits our price target of Rs 157. Traders with a short-term perspective can sell the stock while maintaining a stop-loss at Rs 184.

via BL