Technical Forecasting Of Gujarat Fluoro Chemicals Limited

Acting as the Technical analyst it becomes my prime responsibility to read the charts exhaustively and to tap the regular features and patterns being displayed by it in the due course and suggest some good share investment. However, the currently the market doesn’t seems to be feasible enough to take up any calls and in the near future also. Even if you would have gone through my S&P Nifty Analysis Report I had laid down my expectation to even go down till 5090 levels. The situation doesn’t appear to be sanguine enough to put forth any kind of a long term bet in the equity stocks. In such a complex and critical situation there is a likely possibility that any long term bet can go awry, hence our role as the analyst majorly becomes more responsible to ensure that they may not lose out on their hard earned money.

While I was comprehensively looking into the charts to lay down some fruitful stock investment for you, I came across through one of the feasible stock to take the bets on. The stock is GUJARAT FLUORO CHEMICALS LIMITED. Technically looking into its intraday chart for the previous 3 years, from 19th may; 2009 onwards the stock had formed a very good upward trading channel and the prices were fluctuating within the fraternities of that trading band. The higher highs were being made by the stock at Rs.165, Rs.173, Rs.187, and Rs. 197 respectively being made on 2ndjune;2009, 3rd Sep;2009,18th jan;2010, 2nd aug;2010 respectively , when it finally broke off the trading channel forcefully from 19th jan;2011 onwards moving off higher till Rs.299 levels till 4th feb;2011.Even at looking into the charts, it has become the regular feature of the stock to continue to take the support from 20DMA till it is in its usual uptrend, but when it breaks off the 20DMA, the stock is bound to fall down to retrace back from 200DMA.

Even from 30th nov; 2010, after some drubbing at Rs.162, the stock has again retraced back from the 200DMA and is forming the stiff support from the 20DMA which is in its usual mode moving up to higher levels and is not expected to show any retracement at this point of time. So the support is still expected to get retained for some furthermore sessions to come.

All we need to do is just wait for stock to come down till 262-265 levels from where a long position can be initiated till 295-298 levels furnishing the returns of about 11% in about a month or so with a stiff stop loss at around Rs.250.Till the stock doesn’t show any attempt to break down the 20DMA a long position can be easily initiated with every dip on 20DMA.Even if the stock breaks off the 20DMA to the downside another opportunity is expected to be revealed by the stock as soon as it reaches the 200DMA.

Moving Average Convergence Divergence, one of the most efficient momentum indicators is not showing any kind of divergences with the stock signifying continuation of the uptrend in this stock.

So technically speaking the stock seems to be a safe bet as a good stock investment to take a long term bet for about a month or so, but that too the above suggested levels are needed to be paid due heed to. It is advisable to not to run hasty in taking your positions and wait for the opportune time to arrive to pledge in favor of this stock.

By: Sunil Bisht

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Apart from investing in fixed income securities, stock investment gives a breakthrough to the investors to reap greater returns in a booming share market. However, certain element of risk is also involved in the share market, but one has to entail some risk in order to reap out better returns. No doubt, in the falling market, fixed income instruments would be feasible to bet on, but in case of rising markets adhering to the share tips.