Metal Stocks have been under performers since last 8 years, from 2008-2016 but not now!!! In a broader sense we may say that 8 year bear cycle of commodity prices have ended last year at fundamental level. We have seen global metal prices bouncing almost 20% from the lows in 2016 which has resulted in turned in many global companies like Rio Tinto and BHP. And now metal price hike effect would start appearing on indian metal company’s Balance sheet. But before fundamental guys say’s “BUY”, technical charts have already given a breakout…
Above chart is of TATA STEEL monthly time frame, where we could notice that stock has just notched out of symmetric triangle almost after being intact for 17 years!! This clearly signs of a turnaround for long term. On the upside as a yearly investor, u could see 600 mark but above that it would again be a double bottom breakout which activate target of 950..So ball is in your court to decide what you wanna do with the stock
Strategy for Investors:
Buy CMP: tgts 600/950 SL: 350
Now coming for short term traders, they too have a great trade ahead……………..
So now lets have a look at Daily chart above which says a double bottom breakout with a breakout gap. Even the volumes at the breakout is strong…Yesterday which was a breakout on daily chart is the same price for breakout on Monthly chart as i stated above..So 437 mark is strong technical support now. Though it doesnt mean we can have a profit booking but we may be sure that each dip now is a buy.
Strategy for Traders: Buy with tgts of 500 sl: 412
Happy Profit mining to all!!