We recommend a buy in the stock of Kajaria Ceramics from a short-term perspective. It is apparent from the charts of the stock that in November 2011, the stock took support around Rs 90 and resumed its long-term uptrend. Since then, the stock has been on an intermediate-term uptrend.
Following a short-term sideways movement, the stock made an upward breakthrough of resistance at Rs 180 by jumping five per cent on Thursday with extraordinary volumes. The stock is hovering well above its 21- and 50-day moving averages. The daily relative strength index is featuring in the bullish zone and weekly RSI has re-entered into this zone from the neutral region.
The daily moving average convergence divergence indicator has signalled a buy and is about to enter the positive territory. Both daily and weekly price rate of change indicators are featuring in the positive terrain implying buying interest. We are bullish on the stock from a short-term perspective. We anticipate the stock's up move to prolong and reach our price target of Rs 196 or Rs 200 in the approaching trading sessions. Traders with short-term perspective can consider buying the stock with stop-loss at Rs 184.5 levels.