I have purchased Federal Bank shares at ₹215. What is the outlook?
Mukesh, Patna
Federal Bank (₹177): The long-term trend is up and that is intact. The stock peaked at ₹217 in December last year and has been coming down since then. There is an immediate support at ₹170. A bounce from this support will keep the broader uptrend intact. That leg of upmove will have the potential to take the share price up to ₹240-250 again.
You can buy more at current levels. Keep a stop-loss at ₹158. Move the stop-loss up to ₹190 when the stock goes up to ₹210. Revise the stop-loss higher to ₹220 when the price touches ₹230. Exit at ₹245. If the stock breaks below ₹170, it will be bearish. In that case, a fall to ₹140-135 can be seen. So, if this fall happens, then make sure to adhere to the stop-loss and exit at ₹158.
I have bought Swan Energy at ₹545. Can I continue to hold? What is the outlook?
Manikandan, Chennai
Swan Energy (₹398): After oscillating in a very wide range in 2024, the stock broke the range on the downside earlier this year. The outlook is bearish now. Strong resistance is at ₹480-490. The stock can fall to ₹360 from here. Failure to bounce from around ₹360 can drag the price down to ₹325 as well. The stock has to rise and sustain above ₹500 to turn the outlook bullish. Only then the chances of rising back to ₹800-850 will come back into the picture.
But such a convincing rise above ₹500 will need some strong positive trigger. As such, the rise above ₹500 looks unlikely immediately. Also, there are chances for the stock to get into a consolidation mode between ₹360-₹500 or ₹325-500 for a prolonged period of time. So, you may have to accept the loss and exit the stock immediately.
What is the outlook for Ujjivan Small Finance Bank?
Sheetal, Mumbai
Ujjivan Small Finance Bank (₹35.30): The trend is down and strong since February last year. The price action since the beginning of this year indicates that the stock is getting support around ₹30. There is also a possibility of a double-bottom formation. However, the stock has to breach ₹41 and get a strong follow-through rise after that to indicate a trend reversal.
If that happens, we can get a rise to ₹50-55 in the coming months. On the other hand, if the stock declines below ₹30, the price can tumble to ₹26-23 going forward. So, for now it is better to stay out of this stock. You can consider buying this stock only after a breakout above ₹41 happens. In that case, you can keep the stop-loss at ₹36 and play for the target of ₹54.
I am holding shares of ITI bought at ₹430. What is the long-term outlook for this stock?
Samarth PM
ITI (₹255): The stock has made some wild swings since October last year. There is room for a fall to ₹230-220. There is support in the ₹225-₹215 region which can be tested in the next few weeks. A bounce from there can take the stock up to ₹300-330. But if the stock breaks the support at ₹215, it will come under more pressure.
Such a break can see the share price tumbling towards ₹185 going forward. If you have a high-risk appetite, then you can keep a stop-loss at ₹205 and exit the stock on a rise at ₹330. If a fall below ₹215 happens, then you have to have a strict discipline of adhering to the stop-loss and exit at ₹205. However, considering the fact that this stock is under surveillance, it is better to accept the loss and exit it immediately.
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