Buy NTPC above Rs 157; target of Rs 205/225: Way2Wealth

Way2Wealth's report on NTPC

NTPC the power major, showed immense power in its last trading session to close above its Upper Bollinger Band with high volumes. While considering its channel breakout in the month of May 2014 the stock made a high of 165.84 and retraced back till 132 levels which is 61.8 % Fibonacci level. It seems the stock has completed its 4th corrective wave and has resumed its motive 5th wave which gives a potential upside target of 205/225. Expect price to trade with bullish momentum in coming sessions.

Facts:

Candle Sticks: Multiple Bullish Hammers near 130 levels should acts as strong supports.

Volume: On Balance Volume indicates further upside as the indicator mentions of volume precedes price.

Momentum: RSI is trading above 50 which is a bullish zone

Averages: Bullish crossover in MACD indicates bullishness to continue

Investment Strategy:

Buy NTPC (cash) above 157 with a stop loss below 130 for a Target of 205/225

Risk/return ratio: 1: 1.75

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