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Power Finance Corporation charged ahead with the broader market on Tuesday. Buy the stock with a short-term trading perspective. After registering a 52-week low at Rs 97.4 in early August, the stock reversed its trend. Since then, it has been on a medium-term uptrend. However, on its way higher, the stock encountered a key resistance at Rs 140 that made it reverse lower.
The presence of a significant support at Rs 120 cushioned this decline. After forming a bullish engulfing candlestick pattern, the stock rebounded from this support level with a 5 per cent gain on Tuesday. The indicators in the daily chart are plotting a reversal from the negative territory. Medium-term trend is still upward.
The near-term outlook is bullish for the stock. It can trend higher to Rs 134 or Rs 137 in the ensuing trading sessions. Traders can buy the stock with a stop-loss at Rs 125.7 level.
( Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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