Technical Analysis

Chambal Fertilisers & Chemicals (₹170.3): Buy

Yoganand D BL Research Bureau | Updated on November 01, 2019 Published on November 01, 2019

The stock of Chambal Fertilisers & Chemicals gained bullish momentum and surged 6.4 per cent accompanied by above average volume on Thursday, breaking above a key resistance at ₹160 as as well as the 200-day moving average. This rally strengthens the short-term uptrend. Investors with a short-term horizon can buy the stock at current levels.

The stock took support at around ₹135 in late August and changed direction triggered by positive divergence in the daily relative strength index and the daily price rate of change indicator. Since late August, the stock has been on a short-term uptrend. In mid-October, the stock found support at ₹145 and continued to trend upwards after a corrective decline. It has decisively surpassed its 21- as well as 50-day moving averages recently and trades well above them.

The daily RSI has entered the bullish zone from the neutral region and the weekly RSI is likely to enter the bullish zone from the neutral region. Moreover, both the daily and the weekly price rate of change indicators are featuring in the positive territory signifying buying interest.

Overall, the short-term outlook is bullish. The stock can extend the uptrend and reach the price targets of ₹177.5 and ₹181 in the ensuing trading sessions. Buy with a stop-loss at ₹166.5.

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

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Published on November 01, 2019
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