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We recommend a buy in Shipping Corporation of India. From the chart of Shipping Corporation of India we see that after a steep decline from its resistance level of Rs 330 in mid-January 2008, the stock found support at around Rs 200. Since late January, the stock has been on a medium-term sideways consolidation in the range of Rs 185 and Rs 240. Within this sideways consolidation, we note that the stock has been gradually moving up from the lower boundary (Rs 185 levels) touched in mid March. During this up move, the stock crossed over the 21 and 50-day moving averages. The daily momentum indicator is on the verge of entering the bullish zone from the neutral region and the weekly indicator is rising in the neutral region. The moving average convergence and divergence is displaying positive divergence and is on the brink of entering the positive territory. Our short-term forecast for the stock is bullish. We expect the stock’s current up move to continue further to our target level of Rs 250 in the short-term. Investors with a short-term perspective can buy the stock with stop-loss at Rs 205.

Yoganand D.

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