We recommend a buy in the stock of Jyothy Laboratories from a short-term perspective. It is apparent from the charts of the stock that after peaking out from its new peak of Rs 211 in early June, the stock retraced its previous up move (formed between February and July) completely. Nevertheless, the stock found support at around Rs 143 in early September, which is a key long-term base level. Subsequently, the stock reversed direction triggered by positive divergence in daily moving average convergence divergence and daily price rate of change indicators.
The stock is in a near-term up move. On Tuesday, it climbed 3.6 per cent strengthening its bullish momentum. We observe that there is an increase in daily volume in the past four trading sessions. The daily price rate of change indicator is on the brink of entering the positive terrain from the negative.
The stock is currently testing its immediate resistance and medium-term downtrend-line at around Rs 155. We anticipate it to breach its immediate resistance and reach our price target of Rs 162 or Rs 165 in the ensuing trading sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 152 levels.
( Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)