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Investors with short-term perspective can consider buying the stock of Delta Corp. It is evident from the charts of the stock that its medium-term downtrend which started from its all-time high of Rs 141 in November 2010, halted around its key long-term support level of Rs 60 in early February. However, subsequently the stock changed direction and has been on a medium-term uptrend since then.
On April 1, the stock conclusively broke through its moving average compression (21-, 50- and 200-day moving averages) around Rs 73, by jumping almost 14 per cent with extra-ordinary volumes. Moreover, Delta Corp emphatically broke out of its significant longer-term resistance at Rs 93 by gaining seven per cent with unusual volumes on April 20. This up move has reinforced the stock's ongoing uptrend. The daily relative strength index is featuring in the bullish zone and weekly RSI is on the brink of entering this zone. Both daily as well as weekly moving average convergence divergence indicators are hovering in the positive territory indicating upward momentum.
We are bullish on the stock from short-term perspective. We expect the stock's up move to prolong until it reaches our price target of Rs 100 or Rs 103 in the ensuing trading sessions. Traders can consider buying the stock with stop-loss at Rs 93.5.
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