We recommend a buy in the stock of Shoppers Stop from a short-term horizon. It is apparent from the charts of the stock that in late December 2011, the stock found support around Rs 250 and reversed its direction. This reversal was triggered by positive divergence in daily relative strength index and price rate of change indicators. Since then, the stock has been on a medium-term uptrend.

After retracing 50 per cent Fibonacci retracement level of this uptrend, the stock took support at Rs 307 in early this week. On February 29, the stock jumped five per cent accompanied with above average volume, resuming its medium-term uptrend. This up move has breached its 21-day moving average. Both daily as well as weekly relative strength indices are inching higher in the neutral region towards the bullish zone.

The daily price rate of change indicator is on the brink of entering into the positive region while the weekly indicator is featuring in the positive terrain implying buying interest. Considering that the stock's medium-term uptrend line is intact and showing positive momentum, we are bullish on the stock from a short-term perspective.

We anticipate the stock's up move to prolong and touch our price target of Rs 352 or Rs 362 in the forthcoming trading sessions. Traders with short-term perspective can consider buying the stock with stop-loss at Rs 332.

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