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The stock of CG Power and Industrial Solutions climbed 3.4 per cent with good volume on Friday, strengthening the bullish momentum. It gained 5 per cent, accompanied by extra-ordinary volume last week. Investors with a medium-term horizon can buy the stock at current levels. After a medium-term downtrend, the stock found support at ₹35 in late October 2018. However, it changed direction decisively only in early November after recording a 52-week low at ₹32.8. Since then, the stock has been on a short-term uptrend, backed with good volume. This reversal is also triggered by positive divergence in daily relative strength index and price rate of change indicator. While trending up, the stock breached its 21- and 50-day moving averages in early December and a key resistance at ₹41 on December 21.
The stock continued to trend upwards, witnessing buying interest. The daily relative strength index features in the bullish zone backing the bullish momentum. The weekly RSI has recovered from the oversold territory and features in the neutral region. Both the daily and weekly price rate of change indicators hover in the positive terrain, implying buying interest. The medium-term outlook is bullish for CG Power. The stock can continue to trend up and hit the price targets of ₹52 and ₹53 with a minor pause or sideways move at ₹50. Investors with a medium-term perspective can buy the stock with a stop-loss at ₹42 levels.
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