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The stock of Chambal Fertilisers & Chemicals surged 5 per cent accompanied by above average volume, breaking an immediate resistance at ₹62, on Thursday. Investors with a short-term perspective can buy the stock at current levels. Since taking support at the long-term base level of ₹32 in August 2013, the stock has been in an intermediate-term uptrend.
Thursday’s rally has moved the stock out of a narrow sideways range of ₹59 and ₹62 within which it has been trading since mid-December last year. Moreover, the positive divergence in the daily moving average convergence divergence indicator suggests that the stock’s short-term trend has turned bullish. The relative strength index on the daily chart has entered the bullish zone from the neutral region. The outlook is bullish. The stock can continue its rally to the target of ₹67 and ₹68.5 in the ensuing trading sessions. Buy the stock with a stop-loss at ₹62.7.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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