Investors with a short-term perspective can consider going long in Idea Cellular. The stock surged 4.8 per cent on Tuesday. The stock had been consolidating sideways within its overall downtrend between Rs.125 and Rs.150 since mid-October.
It faced strong resistance near the 100-day moving average at Rs.142 and started declining from the first trading session of this year. The stock plummeted over 23 per cent to record a low of Rs.109.6 this Monday. However, the strong upward reversal on Tuesday has halted the short-term downtrend.
The morning star candle stick pattern formed on Monday signals a reversal in this stock. A corrective rally looks likely in the coming sessions.
Next resistances are at Rs.123 — the 38.2 per cent Fibonacci retracement level — and at Rs.125. Supports are at Rs.113, Rs.111 and Rs.109. Traders with a short-term perspective can go long. Stop-loss can be placed at Rs.112 for the target of Rs.123.
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