Amit Harchekar, Chief Technical Strategist at A PLUS Analytics told CNBC-TV18, "PSU bank Index has already confirmed a start of a three years bear market and if you remember the momentum or the exuberance what we had seven and eight months back, most of the mutual funds were extremely bullish on PSU banks. We believe right now State Bank of India has moved towards the crucial support zone of Rs 230."
"There is a high possibility that lot of fund managers could panic and start selling that stock because it has already been underperforming the market. The long-term head and shoulder pattern in State Bank of India projects at least downside of 30 percent in next three months. So, we would recommend going short at current level," he said.
"The bear market pullback what we were expecting could have extended to around Rs 255. I think that is over and the stock could be heading lower, so keeping stop loss of Rs 236 on the short-term charts, we believe the stock should slide below Rs 200 in the coming days," he added.
"Indiabulls Housing Finance has found a good support at around 200-day moving average. We believe since the stock has not formed a lower low could potential for a rebound. We are expecting a retracement closed to 78 percent of the entire decline. So, we would recommend going long on this counter even at current level. In fact the volume on the price decline has been on the lower side and that is why we believe it is more into accumulation phase. So, keeping stop loss of Rs 630 we are expecting it to go beyond Rs 720-725. So one can buy even at current level."
"Bajaj Auto has been consolidating in last few two months but most importantly the stock has already given a break down from a bearish triangle. We believe the bear market rally in this stock may be over. The triangle breakdown below Rs 2,385 indicates that stock could be heading below Rs 2,200 in next few weeks. So, keeping Rs 2,385 as a record break level which turns out to be again stop loss for your short trade, one can initiate short trade for at least target of Rs 2,200. We are expecting this target to get achieved in eight trading sessions."
"ITD Cementation has already given a breakout from a cup and handle formation and that happened on September of 24. However, despite the breakout the prices had not moved up and right now the stock has managed to re-test the breakout point of around Rs 97-98. We believe since the volume on the current decline has been on the lower side, the stock still has a potential to go beyond Rs 125 because that is amplitude of the cup and handle formation.
"We would recommend going long even at current level because we don’t see further downside in this counter. Keeping stop loss of Rs 92.50 because that tends out to be the trendline support and if that holds on we can easily expect rally of atleast 10 percent in next six trading sessions."
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