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The stock of Indian Hotels Company jumped 6.4 per cent accompanied by above average volume on Wednesday, breaching an immediate resistance at ₹153. Investors with a short-term horizon can by the stock at current levels as it appears to have resumed the short-term uptrend. In mid-September, the stock took support at ₹130 and began to trend upwards. Since then, the stock has been in a short-term uptrend. But after encountering resistance at ₹162 in early October, the stock began to witness a corrective decline. Key support at ₹145 and the 200-DMA hovering at this level has cushioned the stock and subsequently helped it to trend upwards. It has breached the 21-DMA . as well as a key long-term resistance at around ₹150.
The daily relative strength index is on the brink of entering the bullish zone from the neutral region and the weekly RSI is also poised to enter the bullish terrain. Moreover, the daily price rate of change indicator has re-entered the positive zone, which confirms emergence of the buying interest. With the breach of a key resistance and resumption of the uptrend, the short-term outlook is bullish for the stock. Targets are ₹162.5 and ₹165.5. Traders can buy with a stop-loss at ₹152.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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