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We recommend a buy in the stock of Asahi India Glass from a short-term perspective. It is evident from the charts of the stock that after registering a 52-week low at Rs 48 in late December 2012, it bottomed out. This reversal was triggered by positive divergence in weekly relative strength and moving average convergence divergence indicators. Since then, the stock has been on an intermediate-term uptrend. The stock's significant medium-term support in the band between Rs 56 and Rs 59 provided base of the stock while trending upwards. In early August, the stock bounced up taking base at the aforesaid band and has been on a short-term uptrend. Subsequently, the stock breached its 50 and 200-day moving averages and is hovering well above them.
On Monday, the stock jumped six per cent accompanied by above average volume, breaking through its immediate resistance at Rs 67. The daily RSI has entered the bullish zone from the neutral region and weekly RSI is on the brink of entering this zone from the neutral region. Both daily and weekly moving average convergence divergence indicators are hovering in the positive terrain implying upward momentum. We are bullish on the stock from a short-term perspective. We anticipate the stock's rally to prolong and knock our price target of Rs 72.5 or Rs 74.5 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 67.5.
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