After topping off in the end of 2007 at 280 & then again forming a lower top at the beginning of 2010 at 229, Sterlite Industries did not seem to be able to shake off the blues. In 2012 the stock again attempted to turn bullish twice & failed at important resistances as indicated in the monthly chart.
Most recently the stock has shown up-ward moves of over 30% in less than 20 trading days. The up-move so far seems only to be an intermediate trend against the larger downward trend. The base for the stock is not strong at present neither has the stock gained any important resistances nor has it established any strong support levels. Nonetheless the stocks recent move has been strong and worthy of opinion.
So far the stock is facing very strong resistance at 99.25 and the stock will have to gain this price point and stabilize above this to signal a buy for the long term investor. Further resistances are seen at 102.7 & 113.6. The resistance at 102.7 is minor and 113.6 will be the first target for the stock as soon as it turns bullish for the long term from here. The next target would be 124 in the long term i.e. a gain of over 25%.
Support levels for the stock are at 90.7, 81.67 & 75.8. The price zone from 81.67 to 75.8 is very important for the stock as it will act as a very strong support and breaching this will not be very good for the bulls.
Keeping in mind that the stock as of now is still bearish in the long term & bullish in the short term the support levels are the most important to keep track of. As well as the resistance at 99.25 will be very critical for long term investors.