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We recommend a buy in the stock of Dena Bank from a short-term horizon. It is seen from the charts of the stock that it has been on a medium-term uptrend since bottoming out on January 2 at Rs 47.5. However, encountering resistance at around Rs 97 in mid-February, the stock started to move sideways with positive bias.
The stock is hovering well above its 50- and 200-day moving averages. After taking short-term support at around Rs 87, the stock bounced up five per cent accompanied by heavy volume on Tuesday. With this up move it has breached its 21-day moving average and reinforced the bullish momentum. The daily relative strength index is on the brink of entering the bullish zone from the neutral region while the weekly RSI is already featuring in this zone. Both daily as well as weekly moving average convergence divergence indicator are hovering in the positive territory.
The daily price rate of change indicator has entered the positive area implying buying interest. We are bullish on the stock from a short-term horizon. We expect it's up move to continue surpassing its immediate resistance at Rs 97 and hit our price target of Rs 98 or Rs 101 in the ensuing trading sessions. Traders with short-term perspective can consider buying the stock with stop-loss at Rs 92.
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