[Nitin Bhatia]

To Watch ??

Coal India Technical Opinion suggests that stock is still not bottomed out. It has broken it’s key support level of 238 and the trendline indicates that it can fall to the level of 195. In past, it bounced back 4 times from the trendline.

Coal India technical analysis is a typical case of failure of technical analysis. Therefore, it is a case study in itself. The key resistance level is 290 as of today. Coal India also announced buyback recently. However, there is NO Positive impact of the news on the stock.

In terms of harmonic patterns or repetitive patterns, this stock normally forms a W shape. In the last 9 months, it formed W pattern 5 times and sharp fall begins when this pattern was broken. It failed twice in its attempt to form a harmonic pattern. Normally, a stock price shows sharp movement, if the harmonic pattern is broken as we saw in case of reliance.

In terms of moving average, it is trading below 20 periods daily moving average and way below 200 days EMA. The trading in stock is high volume and the size of candlesticks does not support the high volume suggesting buying in the stock. It looks more of selling on candlesticks.

There is not much interest in this stock in the derivatives segment and option chain analysis suggest short term upside.

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