Indiabulls Real Estate – Sell
Investors with medium-term perspective can consider selling the stock of Indiabulls Real Estate (Rs 171.5). The stock has been on an intermediate-term downtrend from its October 2009 peak of Rs 298.
Moreover, the stock continues to be in a long-term downtrend since its all-time high of Rs 847 recorded in early 2008. In mid-August, the stock encountered significant resistance at Rs 200 (a key resistance level and 38.2 fibonacci retracement level of its prior down-move) and the stock began to decline. The stock fell 10 per cent last week and it appears to have resumed its intermediate-term downtrend.
While declining, the stock decisively breached its immediate support at Rs 180 as well as 200-day moving average poised around that level recently. The daily relative strength index is slipping in the neutral region towards bearish zone from its current 41.9 levels. The week RSI reversed lower and is also slipping towards the bearish zone. Daily moving average convergence divergence indicator has signalled a sell and weekly indicator is featuring in the bearish territory, indicating that downward movement is on the cards. The 14-day price rate of change indicators has entered in to the negative territory implying selling interest.
Our medium-term outlook on the stock is negative. We believe that the stock has the potential to continue its ongoing downtrend until it reaches our medium-term price target of Rs 142. Investors with medium-term perspective can sell the stock while maintaining stop-loss at Rs 187.
(This recommendation is based on technical analysis. There is a risk of loss in trading.)
Source : Business Line
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Category: Broker tips
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