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We recommend a buy in the stock of Idea Cellular from a short-term perspective. It is evident from the charts of the stock that it has been in an intermediate-term uptrend since taking support at around Rs 72 in August 2012. Medium-term trend is also up for the stock. Following a corrective decline, the stock found support at Rs 108 in the first week of February this year. Its 50-day moving average also provided base around Rs 108. Strengthening the bullish momentum, the stock jumped more than 4 per cent accompanied by above average volume on Friday. It is hovering well above its 21- and 50-day moving averages. With the recent rally, the stock’s daily relative strength index has entered the bullish zone from the neutral region and the weekly RSI is featuring in this zone. The daily price rate of change indicator has entered the positive territory indicating buying interest. The stock’s intermediate-term uptrend is still in place. Our short-term forecast on the stock is bullish. We expect its rally to continue and reach our price target of Rs 118.5 or Rs 121 in the approaching trading sessions. Traders with short-term perspective can consider buying the stock with stop-loss at Rs 111.7 levels.
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