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We recommend a buy in the stock of Hitachi Home and Life Solutions from a short-term perspective. It is apparent from the charts of the stock that it has been on a sideways consolidation phase in a broad range between Rs 95 and Rs 160 since November 2011.
Within this range the stock took support just above the lower boundary in late July this year and started to move higher. Since then, the stock has been on a medium-term uptrend.
On September 18, the stock jumped 9 per cent accompanied by above average volumes breaking through a key resistance at Rs 125. Further, the stock has breached its moving average compression (21-, 50- and 200-day moving averages) around Rs 120.
The daily relative strength index is featuring in the bullish zone and weekly RSI is on the brink of entering this zone from the neutral region. Both daily as well as weekly price rate of change indicators are featuring in the positive terrain, indicating buying interest. The daily moving average convergence divergence indicator is moving higher in line with the stock price indicating upward momentum. We are bullish on the stock from a short-term perspective. We anticipate the up move to prolong and reach our price target of Rs 146 or Rs 149 in the approaching trading sessions. Traders with short-term perspective may consider buying the stock while maintaining stop-loss at Rs 137.
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