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I am holding shares of Castrol India. I had bought this stock in September this year at ₹156.30. The share price has come down now. What is the outlook? Should I continue to hold or exit?
P.K.N. Namboothiry
Castrol India (₹146.15): The stock is currently at a crucial juncture. A very important resistance is at ₹155. A strong break above it will confirm the end of the long-term downtrend that has been in place since 2015 and indicate a trend reversal. On the chart, the price action since 2020 indicates a base/bottom formation. That leaves the chances high for Castrol India share price to breach ₹155 in the coming months. Such a break will take the share price up to ₹180 initially. A further break above ₹180 will take Castrol India share price up to ₹200 and higher over the long term.
Assuming that you are a long-term investor, keep a stop-loss at ₹120 and hold the stock. Move the stop-loss up to ₹150 when the price moves up to ₹175. Revise the stop-loss further up to ₹185 when the stock moves up to ₹210. Exit the stock at ₹230. If the stock fails to break above ₹155 and falls below ₹130, it can fall to ₹120 and even ₹110. But as seen from the chart, we see high chances for the stock to sustain above ₹135.
I have purchased shares of Alkyl Amines Chemicals at ₹3,169. What is the outlook for the stock? Should I exit the stock and book loss?
Subrata Saha
Alkyl Amines Chemicals (₹2,317.10): The stock has been in a strong downtrend since August 2021. Support is in the ₹2,100-1,900 region. This is holding as of now. However, there is no sign of a reversal or a bottom formation yet. Even if this support zone holds, can the stock stage a strong rally as was seen in 2020 and 2021? That may/may not happen. So even if we assume that the stock is forming a bottom, it might take time for it to rise above your buy price.
Alkyl Amines Chemicals share price will have to rise past ₹2,800 first to indicate a bottom formation. Thereafter, a sustained rise above ₹3,000 will be needed to go back up towards ₹4,000-levels. Considering the time and uncertainty about the bottom formation, we suggest you to exit this stock. You can consider reinvesting the sale proceeds in some other stock that looks good on the charts. May be you can consider Castrol India and follow the strategy mentioned in the previous query.
I have shares of ICRA. I bought this stock at ₹5,100. Should I hold or exit? What is the outlook?
TVS Prakash Rao
ICRA (₹5,644): The trend is up since April 2020. This uptrend is still intact. Strong support is in the ₹5,350-5,300 region and then at ₹5,200. As long as ICRA stays above ₹5,200, there is no danger for the uptrend. Resistance is in the ₹5,850-5,900 region. A break above ₹5,900 can take ICRA share price up to ₹6,350 initially. A further break above ₹6,350 will clear the way for the stock to target ₹6,850-6,950 in the coming months. Keep a stop-loss at ₹5,150 and hold the stock. Move the stop-loss up to ₹5,950 when the price touches ₹6,200.
Revise the stop-loss further up to ₹6,300 when the price touches ₹6,500. Exit the shares at ₹6,750. The stock will come under pressure only if it declines below ₹5,200. In that case, a fall to ₹4,900-4,800 is possible. The long-term uptrend will come under threat only if ICRA share price falls below ₹4,800. But that looks unlikely at the moment.
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