Friday, October 9, 2015

Buy EID Parry with a stop-loss at Rs.142

The stock of EID-Parry India extended its recent rally gaining 3 per cent with extraordinary volume on Thursday. Investors with short-term horizon can consider buying the stock at current levels. 

Following intermediate and medium-term downtrend, the stock found support at around Rs.125 in early September. Triggered by positive divergence in the daily relative strength index, the stock subsequently changed direction. Since then, the stock has been on a nascent uptrend.

The stock has surged 10 per cent this week, conclusively breaching a key immediate resistance at Rs.140. There has been an increase in volumes over the past three sessions.

The daily RSI now features in the bullish zone and the weekly RSI has entered the neutral region from the bearish zone.

The stock trades well above its 21- and 50-day moving averages.The short-term outlook is bullish for the stock. It can continue its rally and reach our price targets of Rs.151 and then Rs.154 in the upcoming trading sessions.

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