Stock Fundamentals

Trading pick of the week: Gateway Distriparks (₹174.3): Buy

Yoganand D | Updated on February 20, 2021 Published on February 20, 2021

Investors with a medium-term perspective can buy the stock of Gateway Distriparks at current levels. The stock took support in the band between ₹70 and ₹74 in June 2020 and since then it has been in an intermediate-term uptrend, forming higher peaks and troughs. In late January this year, the stock witnessed a strong spike, in a single week it had rose 31 per cent, decisively breaking above the key resistances at ₹125 and ₹140 levels and extended the rally. Subsequently, it started to move in a sideways range with a positive bias.

Last week, the stock made an attempt to trend higher by gaining 8 per cent and appeared to have resumed the intermediate-term uptrend.

The stock trades well above the 21- and 50-day moving averages. It has an immediate support in the band between ₹156 and ₹160 that could provide cushion in the coming sessions. As long as the stock trades above this base, the short-term uptrend will remain in place. The daily relative strength index (RSI) has re-entered the bullish zone from the neutral region and the weekly RSI continues to feature in the bullish zone.

There has been an increase in volume over the past three trading sessions. Both the daily and the weekly price rate of change indicators are featuring in the positive terrain, implying buying interest.

Although the stock advanced in the past week, it continues to move sideways above the key support band with a positive bias. It tests a resistance at ₹175. Traders with a medium-term horizon can buy the stock in declines with a deep stop-loss at ₹155.

An emphatic rally beyond ₹175 can pave way for an upmove to ₹190 and then to ₹205 levels over the medium term.

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Published on February 20, 2021
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