We recommend a sell in Rural Electrification Corporation from a short-term perspective. It is apparent from the chart of Rural Electrification that it has been on an intermediate-term downtrend since the day of its listing in March. The stock touched Rs 128, its all-time high on that day and it has been forming lower tops and lower bottoms since then.
However, after recording a life-time low of Rs 62 on October 10, the stock witnessed a corrective up move to Rs 75 level. Due to the presence of significant resistance at around Rs 75 level, the stock failed to surpass this level.
However, after recording a life-time low of Rs 62 on October 10, the stock witnessed a corrective up move to Rs 75 level. Due to the presence of significant resistance at around Rs 75 level, the stock failed to surpass this level.
On October 22, the stock tumbled 6 per cent accompanied with above average volume. The daily relative strength index (RSI) is on the verge of entering the bearish zone from the neutral region and the weekly RSI is featuring in the bearish zone. The intermediate-term down trendline is intact.
Our short-term forecast for the stock is bearish. We anticipate the stock to decline further until it hits our price target of Rs 63 in the forthcoming trading sessions. Traders with short-term perspective can sell the stock while maintaining a stop-loss at Rs 74.
via BL
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