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Investors with a short-term perspective can consider buying the stock of Apollo Tyres. It is seen from the charts of the stock that, after taking support from its base zone between Rs 52 and Rs 55 in December 2011, the stock started to move upwards. Since then, it has been on an intermediate-term uptrend. However, marking an all-time high at Rs 95 in April, the stock experienced a corrective decline. Its significant support range at Rs 75 and Rs 77 arrested the decline in mid-June and provided cushion thereafter. Last week, the stock once again took support from this range and started moving higher.
On Thursday, it advanced five per cent breaching its down trend-line and 50-day moving average around Rs 80. We observe that there is an increase in daily volume over the past three trading sessions. The stock is hovering well above its 200-day moving average. The daily relative strength index has entered the bullish zone from the neutral region and weekly RSI is moving higher in the neutral region. Further, the daily moving average convergence divergence indicator has signalled a buy. We are bullish on the stock from a short-term perspective. We anticipate its rally to continue and reach our price target of Rs 86.5 or Rs 89 in the ensuing trading sessions. Traders with short-term perspective can consider buying the stock with stop-loss at Rs 81.
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