MERCK

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I have pur­chased stocks of Merck at an av­er­age price of Rs 1940. Since the mar­ket is cor­rect­ing heav­ily, I want to know how this stock will fare in the short-medium term?

- Apoorva Shah

HOLD MERCK WITH STOP LOSS OF RS 2480

Merck is cur­rently trad­ing at Rs 2799.95. Its 52-week high/low stand at Rs 3554.40/Rs 1015.50 made on Septem­ber 3, 2018 and Oc­to­ber 17, 2017, re­spec­tively. The stock af­ter reg­is­ter­ing its 52-week high en­tered into a cor­rec­tive phase, where the stock took sup­port around its 100-DMA and wit­nessed a good bounce-back from its 100-DMA, despite the cor­rec­tion in the mar­ket. Go­ing for­ward, the zone of Rs 2480-2540 is a cru­cial sup­port area for the stock as it is the con­flu­ence of 100-DMA, which is cur­rently placed at lev­els of Rs 2540, and the 78.6 per cent re­trace­ment level of rally from Au­gust to Septem­ber (2195-3554.40). The stock may find re­sis­tance around the level of Rs 3000 as de­fined by the chan­nel pat­tern; how­ever, clos­ing above this pat­tern would in­fuse fur­ther bullish­ness and could take the stock to­wards its all-time high lev­els. Con­sid­er­ing the above fac­tors, we would ad­vise you to hold the stock with stop loss of Rs 2480 for an im­me­di­ate tar­get of Rs 3000, fol­lowed by Rs 3550 in the medium term.

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