Investors with a short-term perspective can buy Escorts. It has been on an intermediate-term uptrend since recording a 52-week low at Rs 48 in March 2013. The stock took support at the key base level at Rs 80 in August and resumed the intermediate-term uptrend. Since then short-term trend is also up.

On Friday, the stock surged 6.8 per cent accompanied by extraordinary volumes, reinforcing the bullish momentum. It is hovering well above its 21- and 50-day moving averages. The daily relative strength index is now hovering in the bullish zone implying upward momentum. Similarly, the daily moving average convergence divergence indicator is featuring in the positive territory indicating positive momentum.

The daily price rate of change indicator is hovering in the positive area implying buying interest. The stock’s short-term outlook is bullish. It has the potential to reach Rs 101 or Rs 103 in the approaching trading sessions. Traders can buy the stock with a stop-loss at Rs 95.

(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)

(This article was published on October 13, 2013)
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