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Investors can buy the stock of Welspun India for short-term gains. The company is a fully integrated home textile manufacturer. The stock has been on a long-term uptrend from its December 2011 low of Rs 22. In August 2013, it found support at around Rs 50, following a corrective decline. Subsequently, it resumed its long-term uptrend and started trending northwards.
On Wednesday, the stock decisively broke through an important long-term resistance at Rs 75 by gaining 6 per cent. The stock is trading well above its 50- and 200-day moving averages. Volumes on the daily chart show increase in activity over the past four trading sessions. The medium-term uptrend line is intact. The indicators on the daily chart are featuring in the bullish zone, backing the uptrend. The short-term outlook is bullish and the stock can extend its rally to Rs 83 and then to Rs 85 in the ensuing trading sessions. Buy the stock with a stop-loss at Rs 77.
( Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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