TATAMOTORS

TATAMOTORS (Last: Rs 224.80, up Rs 3.20)

Sell on all three counts (Long, medium and short term basis)

The stock is generating a long term down trend signal as the 2 weeks moving average closed below 52 weeks moving average today. As you can on the chart, the downward trend was orderly in nature as it signaled the correction at Rs 296 and at Rs 261 the system generated the uptrend reversal flag. (see the flags on the chart above).

We expect TATAMOTORS to move down going forward, however, since the stock has declined considerably in the recent past, it may exhibit a choppy trading pattern or generate small time corrective reversal in prices to neutralize the oversold momentum indicators.

Keeping that in mind, we recommend long term investors to use the firmness in prices as an opportunity to exit. Traders are advised to trade the stock on the short side only till we see reversal in moving average setup.

The major resistance levels are Rs 240 and Rs 250. Major support prices are Rs 200 and Rs 170.