Greaves Cotton after the sharp decline in the second half of CY 2017 has formed a base at the Rs 115 levels during March 2018 being the previous multiple lows. The stock since then has steadily moved higher forming higher troughs in the daily chart.
The stock is currently placed at the cusp of a trendline breakout joining the recent highs and the price up move on Wednesday’s session was supported by the strong volume of almost three times the 200 days average volume of 7 lakhs share per session indicating larger participation at the breakout level.
The short-term support is placed around Rs 126 levels as it is the confluence of the trendline support joining lows of March 2018 (113) and June 2018 (120) and the 61.8 percent retracement of the previous up move (120- 139).
Among the oscillators the daily 14 periods RSI has recently generated a bullish crossover above its nine period’s average thus supports the positive bias in the stock.
We expect the stock to continue its positive bias and gradually head towards Rs 150 levels as it is the 123.6 percent extension of the previous up move (120-139) as projected from the recent trough of Rs 128 signals upside towards Rs 150 levels in short-term.
Disclaimer: The author is Head Technical, AVP at ICICI Direct.com Research. The views and investment tips expressed by investment experts on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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