Tata Motors stock has seen a pretty big selling this week:
The Big question:
Has this selling destroyed the Bullish Structure of the stock?
The Answer: Fundamentally - yes but price action wise - the stock needs to see more damage before that can be said conclusively.
Here's the daily Chart
Tata Motors stock created a Gap-up situation above 427 levels around June 2016 and since then every pullback to 427 levels (Brexit, Demonetization) turned out to be a great buying opportunity. I did cover Tata Motors on Dev 05 2016 when the stock was near 427.
But this pullback looks ominous. It has come on back of company-specific fundamental news and hence a break down below 427 looks like a real possibility. Also, all the folks who have been holding the stock in hope of higher prices will be more willing to exit than enter. In other words, any selling below 427 will invite more panic.
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Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers