Today's Pick

Gujarat Mineral Development Corporation (Rs 150) - Buy

D. Yoganand | Updated on June 08, 2011 Published on June 08, 2011

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We recommend a buy in the stock of GMDC from a short-term horizon. It is seen from the charts of GMDC that the stock found support from its long-term base between Rs 100 and Rs 110 in early February and again in March and bounced upwards. Since then, the stock has been on a medium-term uptrend.

In late May, the stock took support from its uptrend-line around Rs 136 and resumed its uptrend by breaching its 21- and 50-day moving averages. The stock is hovering well above these averages and also its 200-day moving average. Strengthening the bullish momentum, the stock surged three per cent accompanied by above average volumes on Wednesday. The 14-day relative strength index is featuring in the bullish zone and weekly RSI has entered in to this zone from the neutral region.

Both daily as well as weekly moving average convergence divergence indicators are hovering in the positive territory signalling upward momentum. Both daily and weekly price rate of change indicators are featuring in the positive terrain denoting buying interest. Considering the intactness of the stocks uptrend-line, we are bullish on it from a short-term perspective. We expect the stock to move higher and reach our price target of Rs 154.5 or Rs 159 in the forthcoming sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 145.5 levels.

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Published on June 08, 2011
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