We recommend a buy in the stock of Kirloskar Oil Engines from a short-term perspective. It is evident from the charts of the stock that after taking support from its long-term base level at around Rs 110, in early January this year, the stock started to trend upwards. Since then, the stock has been on a medium-term uptrend. However, its significant resistance at Rs 150 arrested the stock's rally in mid February. Subsequently, the stock moved sideways, forming an ascending triangle pattern, a bullish continuation pattern, with top horizontal line at Rs 150. On Wednesday , the stock broke out of this pattern by surging 5 per cent, with above average volumes. The stock has crossed its 21-day moving average and is hovering well above its 50-day moving average as well. With this up move the stock has reinforced its bullish momentum. Its daily relative strength index has entered in the bullish zone and weekly RSI is on the brink of entering into the bullish zone from the neutral region. Both daily and weekly price rate of change indicators are featuring in the positive territory, implying buying interest. We are bullish on the stock from a short-term perspective. We anticipate its up move to continue and hit our price target of Rs 157.5 or Rs 162 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 148.

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