Buy Shriram Transport Finance, target Rs 1720: Ashish Chaturmohta

Ashish Chaturmohta

After a long-term consolidation between 1300 and 750 odd levels, Shriram Transport Finance witnessed a breakout from the pattern to hit a high of Rs 1546 in the month of January.

Then price corrected down to its breakout level of Rs 1300 and seen a bounce back. The price has witnessed a rounding pattern formation over the three months and saw a breakout from the same at the start of this month.

Since then the stock price has been trading in a narrow range between Rs 1620-1550 odd levels to form bullish pole and flag pattern which is a continuation pattern.

The relative strength index (RSI) has given positive crossover with its average suggesting stock is likely to see a breakout on the upside. Thus, the stock can be bought at current level and on dips to Rs 1570 with a stop loss below Rs 1540 for a target of Rs 1720 levels.