We recommend a buy in the stock of Aegis Logistics from a short-term horizon. It is seen from the charts of the stock that after encountering resistance at Rs 183 in late January, its bullish momentum started diminishing. Testing this resistance again in early February, the stock changed direction and was on a medium-term downtrend till it found base at Rs 122 in May. After taking support at around Rs 122 in mid-June, the stock started trending higher triggered by positive divergence in daily moving average convergence divergence indicator.

On Wednesday, the stock surged 6.7 per cent, decisively breaking breaching its medium-term downtrend-line and 50-day moving average, accompanied by above average volumes. The stock is hovering well above its 21- and 50-day moving averages. The daily relative strength index has entered into the bullish zone from the neutral region and weekly RSI is featuring the neutral region. The daily MACD is moving higher in line with the stock price and is likely to enter the positive territory. Our short-term outlook on the stock is bullish. We expect its up move to continue and hit our price target of Rs 143 or Rs 147.5 in the approaching trading sessions. Traders with short-term perspective can consider buying the stock with stop-loss at Rs 134.5.

(This article was published on July 4, 2012)
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