KPIT - May 3rd to Jun 15th '12 - Analysis

KPIT has breached key support levels of 112. Next strong support seen between 106 to 107. Breaching that the next retracement level is seen at 101.94

Similarly on RSI momentum indicator, clearly shows a steep downfall and has major support around 34 to 35





























The other way of also analyzing is to draw Fibonacci extension levels by connecting the high (129.35) & the low (115.10) which occured before an intermediate rise

We get the following extension levels

23.6% - 111.74
38.6% - 109.66
50% - 107.98
61.8% - 106.29
71.8% - 103.9
100% - 100.85

If the stock retraces completely to 100.85, then it shows major weakness, however I do not think that is going to happen with KPIT.

We also see William %R showing a sharp decline and is already in a oversold situation which means a upmove is possible any day

KPIT has steadily gone through this phase

1. Sharp increase upwards
2. Consolidation Phase
3. Inverted U-shape seen twice
4. Sharp decline witnessed

So what can be expected next is a reversal, and that will either happen with a sharp reversal or it may go through a consolidation phase before ralling up

So going by extension levels a good stock will start reversing between 50% and 61.8% levels, so with KPIT going through a very bullish run will see reversals between (50% - 107.98) and (61.8% - 106.29)

So you can wait to see if the reversals happen at those levels and then buy it keep a SL just below 100 for a target of 120