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We recommend a buy in the stock Dolphin Offshore Enterprises (India) from a short-term perspective. It is apparent from the charts of the stock that after encountering key resistance at around Rs 128 in January, the stock started to decline. Nevertheless, the stock’s significant long-term support in the band between Rs 85 and Rs 90 arrested its decline in late March this year. Subsequently, the stock started moving sideways in a wide range between Rs 85 and Rs 105, forming an ascending triangle pattern with horizontal line at Rs 105.
On Thursday, the stock broke out of the above mentioned ascending triangle pattern by gaining 11.5 per cent, with good volume. The daily moving average convergence divergence indicator is moving higher in line with the stock price and has entered the positive territory implying upward momentum.
We are bullish on the stock from a short-term perspective. We expect its rally to continue and reach our price target of Rs 114.5 or Rs 116.5 in the approaching trading sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 107.5 level.
( Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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