1) Shriram Transport Finance had been a favorite stock for many institutions for last few months on the backdrop of Banking license which it expects to get from RBI next year.
2) The stock has seen correction with the market in the last few weeks. On Friday though, fresh short positions have been observed.
3) Open Interest has increased in both June and July futures contracts. The trading volume and delivery volumes have increased by 80% and 90% respectively on Friday. Around 50 thousands shares have been added in July and August Futures contracts on Friday.
4) On the charts as well, the short term moving average line (5 Day EMA) has broken long term 34 Day -EMA which indicates weakness.
5) The stock, though, may take a minor support around 720 and can bounce back to 725-730 Rs levels. These levels can be taken advantage of to sell the stock with stop-loss of 745 and target levels of 700 and 685.
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