STOCK IDEA : BEML - A weak stock

This is technical view on BEML on NSE (INDIA) currently trading at 700.45 (weekly close on 16th Nov 2018). Based on observations made on weekly chart, it looks very weak and offers a good shorting opportunity according to my opinion.

1. The stock is in downtrend and price is trading below all important moving averages and EMA20 & EMA50 are sloping down. 

2. A horizontal line (at price of 818) drawn on the chart shows multiple supports and resistances marked by arrows.

3. It is continuously falling after making a high (1947) in the 1st week of Sep 2017 and counter trendline drawn is being respected even now which indicates that price is finding resistance the moment it retraces and then down trend resumes.

4. Now, it has retraced to EMA20 and price indicated rejection in the last week that closed on 16th Nov 2018. This level of rejection also coincides with retracement level 61.8% and also from near trendline acting as resistance (kindly refer enlarged view of chart for recent price action)

5. RSI (14) indicates poor momentum. It is also observed that it has found resistance from 40 at earlier occasion and now shows moving down once again from 44.

In view of above, it is likely to move down in coming days where stop could be above EMA20 in weekly time frame for a short trade.

This is not a stock recommendation for trading. You must appreciate that trading is quite risky. This is being posted to share my view points based on technical inputs as explained above for interaction/cross learning and for educational purpose only

No comments:

Post a Comment