Stocks to stay away from

Published December 05, 2018

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We do not know how true this is, but there is a funny saying that when the US sneezes, India catches a cold. The American markets were down almost 3 per cent in Tuesday's trade. It is expected that India will follow suit. A downward move is expected as the markets goes into trade on Wednesday. We looked at some stocks to stay away from for the time being.

Sun Pharmaceuticals In (SUNPHARMA.NS) Close: 442.90

Sun Pharmaceuticals Industries Limited does not show any clear trend in the medium term but has fallen back inside its downtrend channel in the longer term chart.

The stock has broken its horizontal support of 443 rupees. If the price trades and closes below this level on the next trading day, it will initiate a new sell signal. There is no clear support in the stock, so downside can be huge. In case of a reversal, there is resistance around 500 rupees or 13 per cent higher than Tuesday's close.

Negative volume balance weakens the stock in the short term. RSI is below 30 after the falling prices of the past weeks. The stock has strong negative momentum and further decline is indicated.

Investtech's outlook (one to six months): Negative

Jindal Steel & Power L (JINDALSTEL.NS) Close: 156.65

Jindal Steel & Power Limited is in a falling trend channel both in the medium and the short term. Falling trends indicate that the company experiences negative development and falling buy interest among investors. The stock has marginally broken down through the support at rupees 158. An established break predicts a further decline.

Next support is around 123 rupees or 21 percent down, and shorter term resistance is around 160 and 184 rupees respectively.

Investtech's outlook (one to six months): Negative

Reliance Infrastructur (RELINFRA.NS) Close: 329.00

Reliance Infrastructure Limited shows weak development in a falling trend channel in the medium long term. This signals increasing pessimism among investors and indicates further decline for Reliance Infrastructure Limited.

The stock is heading down after testing resistance at 367 rupees. The stock has support at 287. The RSI curve shows a falling trend, which supports the negative trend. The stock is overall assessed as technically negative for the medium term.

Investtech's outlook (one to six months): Negative

The analyses are based on closing price as per December 04, 2018. Maintaining proper stop loss is always recommended.