Tech query: SpiceJet on minor corrective mode
Prasad Vemuri
SpiceJet (₹93.8): The stock of SpiceJet broke out of a significant medium-term resistance at ₹55 in mid-November and subsequently breached a key long-term resistance at ₹60 and skyrocketed sharply, gaining 31 per cent in second week of November.
Thereafter the stock continued to trend upwards, surpassing key barriers at ₹75 and ₹90. After a blip above ₹100, the stock encountered a key resistance at ₹107 and changed direction in mid-December last year. Since then, it has been on a short-term downtrend.
The stock has now paused above a key base level of ₹90. A strong plunge below this base can pull the stock down to the next base level of ₹80 in the coming weeks. Any further fall can bring back selling pressure and pull the stock lower to the key medium-term trend-deciding level of ₹70. An emphatic plunge below this base will mar the medium-term uptrend that has been in place from the early November low of ₹48.5.Conversely, if the stock reverses higher from the crucial base level of ₹90, it can be kept in a sideways consolidation in the wide band between ₹90 and ₹110 for a while.