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Investors with short-term perspective can consider buying the stock of Balkrishna Industries. It is evident from the charts of the stock that in January 2011, it took support in the range between Rs 110 and Rs 115 and changed its direction. Since then, the stock has been on a medium-term uptrend. Moreover, it appears to have resumed its long-term uptrend that has been in place from its March 2009 trough of Rs 25.
On Wednesday, the stock conclusively broke-out of a significant resistance level around Rs 140, which also coincides with the 61 per cent Fibonacci retracement level of its prior downtrend. The volume traded was extraordinary. Both the daily and weekly price rate of change indicators are featuring in the positive territory implying buying interest. The 14-day relative strength index is hovering in the bullish zone and weekly RSI has just entered this zone signalling upward momentum.
Our short-term forecast on the stock is bullish. We anticipate it to rally further until it touches our price target of Rs 151 or Rs 155 in the approaching trading sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 142.
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