Shares of Blue Star, the country’s largest air-conditioning and commercial refrigeration company, surged 6 per cent with strong volumes on Tuesday. This rally has decisively breached the immediate resistance at Rs 165. Since taking support at Rs 130 in late August 2013, the stock has been on a medium-term uptrend. Significant long-term support at Rs 155 provided base for the stock’s corrective decline last month. The stock’s 50- and 200-day moving averages also acted as key supports around Rs 155. With the recent rally, the stock’s short-term trend has turned positive. The relative strength index on the daily chart has entered the bullish zone from the neutral region.
The weekly RSI too, has entered the bullish zone after a long period denoting strength. The daily and weekly price rate of change indicators are featuring in the positive area. The short-term forecast is bullish. The stock can continue its uptrend and reach the price target of Rs 177 or Rs 181 in the approaching trading sessions. Traders with a short-term perspective can buy the stock with a stop-loss at Rs 166.5.
( Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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