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The outlook for the stock of Tata Motors is bullish. It surged 4.2 per cent on Monday accompanied by strong volumes. The uptrend that had begun from the February low of ₹266 halted at ₹425 in April. The corrective fall from this high found support at the 200-week moving average, which is currently poised at ₹385. After consolidating around this support for about two weeks, the stock resumed its uptrend since last week.
The 4 per cent rally on Monday has helped the stock breach an important resistance at ₹413, which may add strength to the recent upmove. The stock, which faces immediate resistance at ₹425, is likely to move past this hurdle in the upcoming sessions and touch ₹435. A break above ₹435 can see the stock extending its rally to ₹447 and ₹450. Traders with a short-term perspective can go long. Stop-loss can be placed at ₹410 for the target of ₹440. Revise the stop-loss higher to ₹425 as the stock moves up to ₹430.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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