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Investors with a short-term perspective can consider buying the stock of SREI Infrastructure Finance at current levels. Since taking support at ₹70 in December 2016, the stock has been on a medium-term uptrend. However, the stock encountered a key resistance at around ₹98 in February and again in March and began to decline. After hitting the 61.8 per cent Fibonacci retracement level, the stock found support at around ₹81.5 in late March. Subsequently, the stock started moving sideways in a narrow band between ₹81.5 and ₹86.
On Thursday, the stock surged 4.4 per cent with above average volume breaking out of the narrow sideways range. The stock has also breached its 21-DMA showing signs of bullish momentum. The daily price rate of change indicator has entered the positive territory implying buying interest. The stock can continue to move higher and reach the price targets of ₹91 and ₹93. Buy the stock with a stop-loss at ₹85.5.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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