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We recommend a buy in the stock of Sasken Communication Technologies from a short-term perspective. It is evident from the charts of the stock that following a short-term corrective decline from its February peak of Rs 145, it took support around Rs 115 this week. Triggered by positive divergence in daily price rate of change indicator and coupled with significant long-term support, the stock jumped 7.6 per cent with an upward gap on Tuesday.
Volume on that session was extraordinary. The stock's up move has breached its 50- and 200-day moving averages. The stock appears to have resumed its medium-term uptrend that has been in place since late December 2011. The daily relative strength index has reversed higher and is inching up along with weekly RSI in the neutral region.
The daily price rate of change indicator has entered into the positive terrain from the negative area and weekly indicator is also hovering in the positive terrain implying buying interest. We are bullish on the stock from a short-term perspective. We anticipate its present up move to prolong and touch our price target of Rs 126.5 or Rs 130 in the ensuing trading sessions. Traders with a short-term perspective can consider buying the stock with stop-loss at Rs 119.
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