Investors with a short-term perspective can buy the NMDC stock. The stock’s decline has been arrested at its long-term support level of around Rs 95 in early August. Subsequently, it changed direction, triggered by the positive divergence in the daily indicator. Since then, the stock has been on an uptrend and decisively breached a key resistance level of Rs 120 in early September. Taking support at Rs 120, the stock has continued moving upwards. On Wednesday, reinforcing the positive trend, the stock gained 3 per cent accompanied by above average volumes. It is hovering well above its 21- and 50-day moving averages. The daily relative strength index has also entered the bullish zone, implying strength in the stock’s current move. The daily price rate of change indicator is also now in positive territory, indicating buying interest. Therefore, NMDC can trend higher and reach the price target of Rs 132.5 or Rs 135 in the ensuing trading sessions. Buy the stock with a stop-loss at Rs 124.5.

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

(This article was published on October 9, 2013)
XThese are links to The Hindu Business Line suggested by Outbrain, which may or may not be relevant to the other content on this page. You can read Outbrain's privacy and cookie policy here.