Technical Analysis of Eicher Motors.

The stock

had a very strong upward rally starting from the middle of last year eventually pushing past the 8000 mark. After reaching those highs the stock saw a sharp correction profit booking and fell toward the 6500 - 6750 range. Right now the stock is showing signs of recovery. It has stopped falling formed a base, and is slowly moving back up. Immediate Resistance the stock is currently facing a hurdle around the 7250 to 7300 zone. If the daily candle closes above this it shows strength. Major resistance the previous high near the 8000 level is the biggest target and resistance area. Immediate Support the recent bottom area around 6500 to 6700 is acting as a good short-term cushion. Major support there is a clear horizontal line drawn on your chart around 6246. This is a deep strong support level. For short-term buyers it is safest to avoid entering right now and wait for a clear daily close above the 7250-7300 resistance zone with strong volume before making a move. Once this breakout is confirmed you can look for upside targets near the 7500 and 7800 levels. Existing holders should continue to hold their positions patiently as the stock is showing a steady recovery from its recent base. However to protect against sudden reversals both new buyers and current holders must manage their risk by maintaining a strict stop-loss below the crucial 6500-6700 support area. Technical analysis is based on historical patterns and does not guarantee future results. Always use a Stop-Loss to manage your risk.