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We recommend a buy in the stock of Geometric for a short-term horizon. It is visible from the chart of the stock that it has been on an intermediate-term uptrend since August 2011 low at Rs 35. Taking support around Rs 60 in early May, the stock bounced up sharply, continuing its uptrend. In recent times its intermediate-term uptrend-line cushioned the stock. Further, the stock zoomed more than six per cent emphatically breaching its 21- and 50-day moving averages. There is an increase in volumes over the past two trading sessions.
The daily relative strength index has entered the bullish zone and weekly RSI is on the brink of entering this zone from the neutral region. Daily moving average convergence divergence indicator is on the verge of entering the positive territory implying upward momentum. Considering that the stock's intermediate-term uptrend line is intact and strengthening its uptrend, we are bullish on the stock from a short-term perspective. We anticipate its up move to continue and touch our price target of Rs 76 or Rs 78.5 in the approaching trading sessions. Traders with short-term perspective can consider buying the stock with stop at Rs 71.5.
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