We recommend a buy in the stock of Coromandel International from a short-term perspective. It is evident from the charts of the stock that following an intermediate-term downtrend from its September 2012 peak of Rs 304, the stock found support at its key long-term base zone between Rs 165 and Rs 170 in late June. However, after testing this base zone in late July and August, the stock changed direction triggered by positive divergence in daily moving average convergence divergence indicator and weekly relative strength index.

Witnessing buying interest, the stock has been trending upward for the past one week. On Monday, the stock gained 4 per cent breaching its key resistance at Rs 185 and reinforcing its near-term bullish momentum. We notice that there is an increase in daily volume over the past four trading sessions. The stock is trading well above its 21- and 50-day moving averages.

We are bullish on the stock from a short-term perspective. We anticipate its up move to continue and reach our price target of Rs 204 or Rs 208 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 192 level.

Yoganand D.

BL Research Bureau

( Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)