Investors with short-term perspective can consider buying the stock of IRB Infrastructure Developers. It is evident from the charts of the stock that since peaking out at its all-time high at Rs 312 in August 2010, the stock has been on a long-term downtrend. Medium-term trend is also down from this April peak of Rs 230 levels.

However, the presence of significant long-term support at Rs 140 arrested the stock's decline in mid-August. After taking support from this base level, the stock bounced up two weeks ago. It appears to have changed its trend triggered by prolonged positive divergence displayed in weekly moving average convergence divergence indicator.

The stock has been trending northwards since then. On Wednesday, the stock jumped 5.4 per cent breaking through a key intermediate-term resistance at around Rs 160. This has also made it breach its 50-day moving average around Rs 166 and the stock is now hovering well above its 21- and 50-day moving averages.

We observe that there has been an increase in volumes over the past three trading sessions. Daily relative strength index is on the brink of entering in to the bullish zone and weekly RSI is inching higher towards this zone. Both daily and weekly MACD have signalled a buy.

We are bullish on the stock from a short-term perspective. We anticipate it to move higher until it reaches our price target of Rs 175.5 or Rs 180.5 in the forthcoming sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 166.

comment COMMENT NOW