The stock of Escorts surged 7 per cent, conclusively breaking out of a key long-term resistance at ₹138 on Thursday. This rally is positive from the short-term perspective and traders can consider buying the stock at current levels.

Since the Mach 2013 low of ₹48, the stock has been on a long-term utrend. Within this uptrend, the stock is in a sideways consolidation phase with a positive bias. Last week, the stock emphatically breached the 50- as well as 200-day moving averages and is currently trading well above these levels. The daily relative strength index is featuring in the bullish zone and weekly RSI has just entered the bullish zone, adding strength to the ongoing uptrend.

Both the daily and weekly price rate of change indicators are hovering in the positive terrain. The short-term outlook is bullish. The stock can extend its current bullish momentum and hit the price target of ₹151 and then ₹154 in the coming trading sessions. Buy the stock with a stop-loss at ₹141.5.

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

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