Chennai Petroleum- Support

Chennai Petroleum has entered into a strong support zone in this otherwise selective bull market. The following are some of the reasons on the technical side for this chart to look at a 'buy' or 'hold'.

• The stock has recently corrected from a high of Rs. 240 to current levels of Rs.200. While the stock has witnessed strong sales backed with volumes, the recent fall within this indicates that there is a certain amount of value buying in this stock. The stock's recent correction from Rs 210 to its current levels has seen a volume increase in the buying of shares.
• MACD is on the negative side and has just broken into the negative zone, indicating some bearishness in the stock.
• The RSI is in a strong foothold at 40, indicating the stock not being an 'oversold' stock.

Overall, a correction in this stock would take it to somewhere between 180 and 190 and a strong run in this stock will take it to Rs. 220.