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Is the fall over in Graphite??

Graphite India Limited

Graphite India Limited (GIL) is the pioneer in India for manufacture of Graphite Electrodes as well as Carbon and Graphite Speciality products. GIL’s manufacturing facilities are spread across 6 plants in India and it has also got a 100% owned subsidiary at Nuremberg, Germany, by name Graphite COVA GmbH.

Technical View:

Graphite has lost nearly 60% of its  value from the highs of 1127 to 476. The stock has closed in the red for the past 11 weeks in a row. This goes to show the weakness in the counter. The Fibonacci grid is coming from the lower high of 1062 and that’s an indication that the stock is  contracting. The stock has broken two important supports on its way down without much effort. One at 695 the zone was held for  four weeks and then the lower at 606-585 was also broken with ease. The trend of the stock is intact as long as the 61.8% of the entire swing is held. The same lies at 471 and the stock has moved up a tad before the zone making lows around it at 475.85.  The last week candle is a long ranged bear candle indicating  exhaustion . Therefore the stock retracing from the current levels is very high.  The first hurdle will be at 585-606 and then at 695 levels. The 38.2% retracement of the fall comes to 695 levels and that’s a very high probability that the stock will bounce back to these levels again. The rally in the stock should be used to exit the stock  as the stock is contracting. The RSI is in the overbought zone as well and therefore  with the stock at support the probability of a  rally from here is  very high.

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