Tata Motors shares in a free fall, what is the right price to buy?

Shares of Tata Motors Ltd are down for the sixth straight session today. The Tata Group stock, which closed at Rs 1119.65 on August 29, 2024 fell to an intraday low of Rs 1047.55 in the current session, falling 6.5% during the period. The multibagger stock fell 2% to Rs 1047.55 in the current session against the previous close of Rs  1068.65 today. Market cap of the firm slipped to Rs 3.5 lakh crore.

On BSE, around 2.36 lakh shares changed hands amounting to a turnover of Rs 24.99 crore today. 

Shares of Tata Motors hit a record high of Rs 1179.05 on July 30 this year and fell to their 52-week low of Rs 608.45 on October 4, 2023. 

The multibagger auto stock has climbed 72.57% in a year and risen 254% in three years. Tata Motors stock has a one-year beta of 0.9, indicating very low volatility during the period.

In terms of technicals, the relative strength index (RSI) of Tata Motors stood at 55.2, signaling it's trading neither in the overbought nor in the oversold zone. 

Tata Motors shares are trading lower than the 5 day, 10 day, 20 day, 30 day and higher than the 50 day, 100 day, 150 day and 200 day moving averages.

Commenting on the outlook of the stock amid the ongoing correction, Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers said support will be at Rs 1,020 and resistance at Rs 1,080. A decisive close above Rs 1,080 may trigger a further upside towards Rs 1,140. The expected trading range will be between Rs 1,000 and Rs 1,150 in the short-term. "

Kushal Gandhi, Technical Analyst, StoxBox said, "The price action of Tata Motors is currently trading in a distribution phase after scaling to life highs of Rs 1179. It has been trading with a lower high pivotal price structure with the previous gap-down observed near the level of Rs 1144- Rs 1120 acting as an immediate supply zone. The RSI across daily and higher timeframes are trading with a negative slope and show divergence compared to the price indicating a waning of price momentum. We anticipate a potential upside in the share price on decisively reclaiming the resistance zone on a closing basis."

Aditya Agarwal, Head Derivatives & Technical at Sanctum Wealth said, "Tata Motors has been trading in a narrow band for last few days and has given a breakdown below its support zone of Rs 1,065. From the short-term perspective, the stock looks weak and on lower side can move towards Rs 1025/1004 levels."