Technical Analysis

Bharat Electronics (₹121): Buy

Yoganand D BL Research Bureau | Updated on August 09, 2018 Published on August 08, 2018

Investors with a short-term view can buy the stock of Bharat Electronics (BEL) at current levels. Following an intermediate-term downtrend, the stock found support at ₹96.7 in mid-July this year. However, the stock changed direction thereafter triggered by positive divergence in weekly relative strength index and price rate of change indicator.

The stock has been in a nascent uptrend over the last three weeks. Last week, the stock jumped 16.6 per cent accompanied by good volume, decisively breaching the 21- and 50-day moving averages. But, the stock began to pause at around ₹120 recently.

On Wednesday, the stock surged almost 4 per cent with above average volume strengthening the uptrend. With this rally the daily relative strength index has re-entered the bullish zone from the neutral region and the weekly RSI hovers in the neutral region.

The short-term bias is bullish for the stock. It can decisively surpass the current resistance at ₹120 and reach the price targets of ₹126 and ₹128.5 in the ensuing trading sessions. Buy the stock with a stop-loss at ₹118.5.

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

Published on August 08, 2018
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