Buy MRF; target Rs 15449-16360: Way2Wealth

Way2Wealth's report on MRF

"MRF has provided a breakout from a triangular pattern which was in formation since 3-4 months. The wave E ended at 12670 levels; hence that becomes a crucial support for the stock in the medium term. Very unusual pattern has been formed in this stock i.e. inside the triangle, one more triangle in wave E was formed which has been observed in markets but is quite rare. The relevance of the pattern becomes high when it is compared or cross verified with its momentum indicator. In this case, the momentum indicator KST, too, was consolidating and in that process it has also formed a triangle. The initial target on the upside comes to 15499 i.e. its previous swing high, whereas the equality target for it comes to 16360 levels. Since, it has provided a strong up move today, so todays swing low i.e. 12830 should not be broken in near future."

Investment Strategy:
Buy MRF (cash) above Rs 13781 for the target of Rs 15449 and Rs 16360 with a stop loss of Rs 12829.
Risk: Reward = 1: 2.70
Risk: 13781 – 12829 = 952
Reward: 16360 – 13781 = 2579

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