The stock of Max India has gained 3.5 per cent on Thursday, after taking support at around ₹80 recently. Investors with a contrarian view and high risk appetite can consider buying the stock at current levels.
Following a medium-term downtrend, the stock recorded a 52-week low at ₹78 in early April and found support at that level. Since then, the stock has been in a sideways movement, in the band between ₹78 and ₹90. The lower boundary at around ₹80 has been providing base since early April.
The stock has reversed higher from this significant support level, backed by positive divergence in daily as well as weekly indicators. The daily and weekly relative strength indices are displaying positive divergence backing an upward trend reversal. The daily price rate of change indicator feature in the positive territory implying buying interest.
The stock breached its 21-day moving average on Thursday, showing signs of bullish momentum. The near-term outlook is bullish for the stock. It can extend its current rally and reach the price targets of ₹87.5 and ₹89.5 in the coming trading sessions.
Traders with a contrarian view can buy the stock with a stop-loss at ₹82.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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