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As the markets are taking correction, traders can add some short candidates to their portfolios to offset the risk to some extent in long positions. For such an opportunity, they can put Oberoi Realty (NS:) shares on the watchlist which is probably preparing for a firm trend reversal.
Firstly, the entire realty pack is seeing profit booking after a stupendous run. In fact, the index is currently the top losing sector for the day so far, trading with a cut of 1.19% to 534.8, by 11:00 AM IST. If it keeps on correcting for a while, individual stocks in this space might come under the scanner of bears.
Image Description: Daily chart of Oberoi Realty (spot)
Image Source: Investing.com
This company operates in the real estate space and has a market capitalization of INR 40,236 crore. The stock has delivered a decent rally of 21.6% in the last 12 months, which is not at all bad, but still underperformed the Nifty Realty index’s return of 24.5% in the same period. For the last 3 months, the stock has been rising inside an upward-trending channel which is a bullish pattern.
The stock keeps on bouncing between the rising upper and lower trendlines and this price action keeps on continuing till the uptrend is in place. Once the stock breaks the lower trendline support, then traders can try to explore short opportunities as this breakdown indicates a probable trend reversal towards the downside.
In the case of Oberoi Realty, the stock is currently inside the channel, however, its 2.5% cut to INR 1,078 so far is indicating increased selling pressure. Once the lower trendline is breached, which is currently quite near, at INR 1,065, then bears can make money off this counter’s probable further slide to the next support of INR 1,030.
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