Today's Pick

Berger Paints India (Rs 97): Buy

Yoganand D. | Updated on May 09, 2011 Published on May 09, 2011


We recommend a buy in the stock of Berger Paints India from a short-term time frame. It is seen from the charts that after retracing 50 per cent fibonacci retracement level of its prior major uptrend, the stock found support at Rs 74 in February 2011. The stock bounced up and has been on a medium-term uptrend since then. Following a minor sideways consolidation, the stock broke out of it on Monday which is a positive factor.

It has surged seven per cent accompanied by good volume. Moreover, this up move has breached its 50- and 200-day moving averages. The daily relative strength index has entered the bullish zone from the neutral region and weekly RSI is on the verge of entering this zone. Both daily and weekly price rate of change indicators are featuring in the positive territory indicating buying interest.

Additionally, the weekly moving average convergence divergence indicator is on the brink of entering into the positive territory signalling upward momentum. The medium-term uptrend line is intact. We are bullish on the stock from. We anticipate it to move higher until it touches our price target of Rs 100 or Rs 103. Traders with short-term perspective can buy the stock with stop-loss at Rs 94.

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Published on May 09, 2011
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