The HDFC Bank scrip has given an extremely weak singal. It fell below an important support level of Rs 55. When the stock fell from a high of Rs 87 in the second quarter, it recieved a support at Rs 55. Another bottom was established at the same level during the last week of August this year. The next support level for the stock is much below from the current level.Now with the latest fall to Rs 51.75, the Rs 55 level, which was a strong support level, has now become a resistance level. This means that in case of a rally, the stock is expected to face strong selling pressure in this area.
The position of oscillators is also bearish. The medium term MACD is in a negative phase whereas the 21-day RSI is close to its 7-month low. All these factors are pointers towards a bearish outlook. As such, an exit at the current level is recommended. Re-entry can be considered at lower levels.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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