The stock of Gujarat State Petronet jumped 3.5 per cent accompanied by strong volume on Wednesday. With this rally, the stock has conclusively breached a significant long-term resistance level at ₹63. The stock had repeatedly been hammered at this ceiling during November and December 2013. Traders with a short-term perspective can take this opportunity to buy the stock at current levels.
GSPL has been on an intermediate-term uptrend since taking support at ₹50 in August 2013. In late February, the stock emphatically crossed its 50- and 200-day moving averages making way for a short-term uptrend. Both the daily and weekly relative strength indices are featuring in the bullish zone signifying upward momentum. Our short-term outlook on GSPL is optimistic.
It can continue to rally and reach the price target of ₹67.5 and ₹68.5. Buy it with a stop-loss at ₹63.2.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)