Investors with a short-term perspective can buy Petronet LNG at current levels. After an intermediate-term downtrend, the stock found support around Rs 115 in late June and July. Subsequently, the stock started moving sideways in a wide range between Rs 115 and Rs 134. The lower boundary (Rs 115) is also a significant long-term support for the stock. Within this range, the stock gained 3.5 per cent conclusively breaching its 21- and 50-day moving averages on Wednesday.
Volumes accompanying this surge were above average indicating strength. Both the daily and weekly relative strength indices are inching upwards in the neutral zone. The moving average convergence divergence indicator has signalled a buy and is now on the brink of re-entering the positive territory. Further, both the daily and weekly price rate of change indicators have entered the positive terrain implying buying interest. With these indications, the stock has the potential to trend higher and reach its upper boundary in the short term. Targets are Rs 131.5 and Rs 134. Buy the stock with a stop-loss at Rs 123.5.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)