Today's Pick - Escorts

We recommend a sell in Escorts from a short-term perspective. From the charts of Escorts, we see that the stock encountered resistance at Rs 170 in early January 2008 and began to decline. The stock has been on a medium-term downtrend since its January peak. However, following a pullback rally from the support level at Rs 75, the stock recently met with significant resistance at Rs 115 and resumed the medium-term downtrend from here.

The stock is trading well below the 50 and 200-day moving averages. The daily momentum indicator is on the verge of entering the bearish zone. The daily moving average convergence divergence is featuring in the negative territory. Our short-term outlook for the stock is bearish.

We expect the stock to decline further to our target price level of Rs 85 in the short-term. Investors with a short-term perspective can sell the stock while keeping the stop loss at Rs 112.

Via Businessline