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The stock of Finolex Cables rose 3 per cent on Wednesday, decisively breaching its 200-day moving average. Investors with a short-term perspective can consider buying the stock at current levels. The stock has been consolidating sideways in the ₹230-270 band since May 2015. Within this range, the key support at ₹240 was providing a base for the stock over the past two months.
The stock’s recent rally has decisively breached the moving average compression (21-, 50- and 200-day moving averages) at around ₹250, which is a clear positive indication. Both the daily and weekly price rate of change indicators are featuring in the positive terrain implying buying interest.
The short-term outlook is bullish. The stock can extend its ongoing rally and reach the initial price target of ₹270. A strong break of the upper boundary can push the stock higher to ₹276 or ₹280. Buy the stock with a stop-loss at ₹255.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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