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Investors with short-term perspective can consider buying the mining stock NMDC. It is seen from the charts of the stock that following a steep decline from the key resistance at Rs 225 in late October 2011, the stock found support recording a 52-week low at Rs 136 on December 20, 2011. Subsequently, the stock changed its trend and has been on a medium-term uptrend gaining 44 per cent.
On February 1, the stock conclusively breached its important resistance at Rs 180 by advancing 3.5 per cent with good volume. Reinforcing the uptrend, the stock increased five per cent accompanied by above average volume on Wednesday. It is trading well above both 21- and 50-day moving averages. The daily relative strength index has re-entered into the bullish zone from the neutral region and weekly RSI is moving higher towards the bullish zone.
The daily moving average convergence divergence indicator is featuring in the positive terrain implying upward momentum. Considering that the stock's medium-term uptrend is intact, we are bullish on it from a short-term perspective. We anticipate the stock to continue its up move and touch our price target of Rs 202.5 or Rs 208.5 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock with stop-loss at Rs 191.
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