The stock has broken below a support at Rs 160.1, the 76.4 per cent Fibonacci retracement level of the uptrend from November 21, 2011 low to September 7, 2016 high.
Shares of Tata Motors fell as much as 3.08%, reaching over 7-year low. The stock has broken below a support at Rs 160.1, the 76.4 per cent Fibonacci retracement level of the uptrend from November 21, 2011 low to September 7, 2016 high.
This suggests that the stock may fall up to the next support at Rs 136.45, the 138.2 per cent Fibonacci projection level of the downtrend from September 7, 2016 high to August 11, 2017 low (wave (A)).
The stock's wave pattern suggests that it is in the final sub-wave c of the downtrend. Therefore, a trend reversal is possible once the index finds a support. MACD is negative and below its signal line. Tata Motors stock had fallen 58.5 per cent in the last three years, as of Friday's close, while, the broader NSE index was up 34.6 per cent in the same period.
Earlier in November, Moody's Investors Service changed Tata Motors' rating outlook to negative from stable, citing expectations of weak operating performance of the company's British arm Jaguar Land Rover (JLR).
The ratings agency has also affirmed the 'corporate family rating' and the company's senior unsecured instruments ratings at Ba2, which is considered to be speculative grade and subject to substantial credit risk.
"The negative outlook reflects JLR's weakening credit profile and the significant challenges in accomplishing a rapid turnaround amid heightened market risks and headwinds from rising input costs and fuel prices, as well as adverse impacts from the outcome of the Brexit negotiations," Moody's had said.
(With inputs from Reuters)