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Investors looking for a trading pick can choose McNally Bharat Engineering Company. The stock has been rallying since the low formed at Rs 37 in August this year. Within this uptrend, the stock was in a brief consolidation phase. This phase resulted in the formation of an ascending triangle pattern with horizontal line at Rs 62. This is a bullish continuation pattern. On Monday, the stock decisively broke out the triangle pattern by gaining 7.8 per cent with good volumes.
The stock is currently hovering well above its 21- and 50-day moving averages. Indicators in the daily chart such as the relative strength index and the moving average convergence divergence are in the bullish zone. Weekly indicators are poised on the verge of signalling a buy.
The outlook for the stock is bullish since the medium-term uptrend line has not been breached yet. The stock can trend upward and reach the price target of Rs 68 or Rs 69.5 in the ensuing trading sessions. It can be brought with a stop-loss at Rs 63.8 level.
( Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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