Sell in the stock of Union Bank of India from a short-term perspective. It is evident from the charts of the stock that it had been on an intermediate-term uptrend from its March low of Rs 115 to its July high of Rs 264. However, the stock was experiencing selling interest around resistance levels of Rs 260. A negative divergence displayed in the daily moving average convergence and divergence triggered the stock’s trend reversal. Since the July high, the stock has been on a short-term downtrend. In late July, the stock breached its 21-day moving average and penetrated its intermediate-term uptrend-line as well as 50-day moving average, declining almost 4 per cent on August 10. With this decline, the daily relative strength index (RSI) has entered the bearish zone from the neutral region and weekly RSI has entered the neutral region from the bullish zone. We are bearish on the stock from a short-term perspective. We expect it to decline until it hits our price target of Rs 197. Traders with a short-term perspective can sell the stock while maintaining a stop-loss at Rs 230.
source: BL
source: BL
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