Technical Analysis

Atul Auto (₹281.7): Buy

Yoganand D BL Research Bureau | Updated on January 22, 2020

Investors with a short-term perspective can buy the stock of Atul Auto at current levels. The stock jumped 10 per cent with extraordinary volume on Tuesday, breaching an intermediate-term downtrend-line as well as 200-day moving average. It has potential to trend upwards in the ensuing trading sessions.

Following an intermediate-term downtrend, the stock registered a 52-week low at ₹198 in late August 2019 and reversed direction triggered by positive divergence in the daily relative strength index. Since then, the stock has been in a medium-term uptrend. It trades well above the 21- and 50-day moving averages.

The recent rally has decisively breached a key resistance at ₹250. The daily relative strength index features in the bullish zone and the weekly RSI has just entered the bullish zone from the neutral region. Both the daily as well as the weekly price rate of change indicators hover in the positive terrain implying buying interest.

The short-term outlook is bullish for Atul Auto. It can continue to trend upwards and reach the price targets of ₹295 and ₹300 in the forthcoming trading sessions. Traders with a short-term view can buy with a stop-loss at ₹274 levels.

(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)

Published on January 22, 2020

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