IDFC hit its life-time high in 2008 at around 235 & is now at 50% of that at around 112. Two attempts to rally since then, one in 2009 ended with a lower high and another in 2012 ended with an even lower high of 185 in January 2013. The lows however have been haphazard, sometime making higher lows like in 2011 & a lower low recently in 2013.
Looking at the chart recently we've seen a rally from 75 to a recent close of 126, a price appreciation of 50% in about 3 months. But the real question is whether this rally will sustain in the long term for investors. We see the stock facing major resistance in the range of 113.5 to 126.5 with resistance points at 113.5, 120 & 126.5. This zone will prove tough for the stock to move up & even if there is a move above this, then the stock will have to wait & Stabilize above 120 for a long period of time in-order to rally further higher. Any volatile moves above this zone will be not worth investing yet & may be cut short abruptly.
Support levels for the stock are seen at 98, 93.5 & 88.5. The support level at 93.5 is the strongest available for the stock as of now & any price action below this will signal the end of the present up-move & will confirm this up-move to be just an intermediate trend.
The stock will not be a good investment bet any time soon, we see this to be an intermediate trend against the major trend as of now. To change that the sock will have to consistently sustain above he price point of 120. Until then the stock is still in a bear market.
ITC is looking like it's coming into a minor consolidation area, but the stock looks very bullish & it looks like after the consolidation is exhausted the stock will move up much further to continue making new life time highs.
In my new video below I discuss the stocks future potential & it's key supports and resistances.
Supports - 320, 311
Resistances - 400, 450, 470
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Today's ITC Video - English Video - http://www.youtube.com/watch?v=gwSS5U41s5w
Today's ITC Video - Hindi Video - http://www.youtube.com/watch?v=5XHSDmqnVK4
Given that the IT index & IT stocks are some of the only few market majors that have truly contributed in moving the Nifty up over the past 12-16 months, the question arises now that will these stocks still move up and perform in the coming months. Let's take a look at the charts of Infosys to answer this.
The up-move in Infosys began explosively and moved towards it's major resistance at 2920. Stocks that explode into rallies can be highly rewarding but also very risky, entries should only be taken upon consolidation or upon break of an important resistance. The up-move made a top at 3010 & then the stock moved below the important level of 2920. Looking at the stock's charts now 2828 is a minor support which will turn into a resistance once it's broken. Major supports lie at 2700 and 2580, these are the only real supports for the stock.
Investors that have purchased the stock on the rally should exit only on the break of 2580 which is the major resistance & re-enter if and only if the stock moves above 2920 conclusively with the same as a stop loss on a daily closing basis. Investors that are looking to enter the stock presently should look for consolidation at around 2700 & buy into the stock at these prices with a stop loss of 2580. If the stock does not approach 2700 and moves back up then investors should only enter above 2920 with the same as a stop loss as discussed above.
We have so far seen a very reluctant rally in the broader indices over the last 12-18 months, so we suggest extreme caution with investments. The intermediate trend in downwards & volatile but the long term upward trend is still holding.
Market crashes 55 points (1%) in 45 minutes... a couple of hours later recovers all of it & is +40 points now. All of this already and the WPI numbers are still not out yet! We predicted that this zone will be very choppy... but surprisingly also as predicted the bias still holds unless 5856 is broken on a daily closing basis.
Today's a very interesting day...
Today's Levels -
5910 as intraday resistance
*5901 & 5969 as swing/positional resistance
5846 & 5805 as intraday supports
*5856 as support on closing basis - Swing/Positional
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