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The stock of NMDC gained 4.5 per cent on Thursday, moving above a key resistance level of ₹110 — the 50-day moving average. Investors with a short-term perspective can buy the stock at current levels. Following a short-term corrective downtrend, the stock retraced 61.8 per cent Fibonacci retracement level of its prior uptrend and found support at ₹105 last week. The stock subsequently bounced up, resuming the medium-term uptrend that has been in place from the July 2018 low of ₹93.5.
The recent upmove has decisively breached the 21- and 50-day moving averages and is hovering well above these levels. There has been a rise in daily volumes over the past three trading sessions. Both daily and weekly relative strength indices are featuring in the neutral region, with positive bias. Further, the daily and weekly price rate of change indicators are hovering in the positive territory, implying buying interest. The short-term outlook is bullish for the stock. It can extend the upmove and reach the price targets of ₹118.5 and ₹121 in the upcoming sessions. Traders can buy the stock with stop-loss at ₹111.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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