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We recommend a buy in the stock of Welspun Corp from a short-term perspective. It is evident from the charts of the stock that after encountering key resistance at Rs 275 in early November, it tumbled steeply and found support at Rs 145 in a short span of one month.
The stock has been on a sideways consolidation in the range between Rs 145 and Rs 180 since early December. Though it is moving sideways, its daily moving average convergence divergence indicator is steadily trending higher displaying positive divergence. Moreover, weekly relative strength index also displays positive divergence indicating trend reversal.
The stock has been inching higher in the past two weeks backed with good volumes during advance days. It has breached its 21- and 50-day moving averages signalling initial signs of bullishness. The daily RSI is on the verge of entering into bullish zone from the neutral region and weekly RSI is likely to enter into neutral region from the bearish zone.
We are bullish on the stock from a short-term perspective. We anticipate it to move higher until it reaches our price target of Rs 176 or Rs 182 in the ensuing trading sessions. Traders with short-term perspective can consider buying the stock with stop-loss at Rs 167.
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