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The stock of Exide Industries gained 5 per cent with good volume on Thursday. Investors with a short-term perspective and contrarian view can buy the stock at current levels.
Last week, the stock recorded a new 52-week low at ₹121.9 and started to move sideways. On Thursday, the stock took support at ₹125 and bounced up strongly, surpassing an immediate resistance at ₹135. This reversal is triggered by positive divergence in the daily relative strength index which is recovering from the oversold territory. Also, the daily price rate of change indicator is recovering from the oversold territory. Likewise, the weekly indicators are featuring in the oversold territory signalling that potential price recovery is on cards.
The short-term outlook appears to be positive for the stock, from a contrarian perspective. It can continue to trend upwards in the ensuing trading sessions and reach the price targets of ₹146 and ₹150 levels. Traders can buy the stock with a stop-loss at ₹135.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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