HINDUNILVR(4th July;2011-8th July;2011)

The stock on the whole has picked up an uptrend with the upward sloping trading channel continuing in the stock from 8^th July ’2008 onwards. Prior patterns in the charts have been clearly advocating that whenever it has tried to break off the upward resistance level of the stock, the formation of the black candle to close within the range suggests the minor retracement in the prices of the stock to take the first support from the 20DMA .however, the long term moving averages have not been showing any signs of retracement and moreover, the stock after taking the higher high has been falling back on to take the support from 20DMA  from quite a few sessions starting from 11^th may;2011 onwards. Currently the stock has attempted to break off the upward trading range to the upside, but the fall back of prices to close within the vicinities of the trading range suggests the next possible attempt of the stock to take the support from the 20DMA.

Moreover, the Fibonacci time ranges are clearly suggesting that once the stock loses the level of rs.336.50 to the downside, the retracement shall be confirmed and the next attempted support levels shall coerce it to drop off at the levels of rs.321-324, which is the next support levels imparted by the Fibonacci time ranges in the coming week ending 8^th July; 2011.

Indicators are also suggesting that the downside movement is strong in the stock with everyone sharply falling downside in an attempt to lose their hold off from their overbought zones. The average volatility in the stock has been coming at around Rs.5, hence it is feasible to buy put options in the stock with a strike prices of Rs.321-322 for about a week or so.

Disclaimer -These calls are based on the theory of technical analysis and personal observations and are not recommendations to any person to buy or sell any securities. The information is derived from sources that are deemed to be reliable but its accuracy and completeness are not guaranteed. Readers of this column who buy or sell securities based on the information in this column are solely responsible for their actions and profit or loss. It is only the outlook of the market with reference to its previous performance. You are advised to take your position with your sense and judgment. We are trying to consider the fundamental validity of stocks as far as possible, but Stock market is highly unpredictable and demand and supply affects it. And author won't be liable or responsible for any legal or financial losses made by anyone.