Todays Pick

Chennai Petroleum Corporation (₹122.8): Buy

Yoganand D BL Research Bureau | Updated on May 19, 2021

The stock of Chennai Petroleum Corporation gained 4.4 per cent accompanied by above average volume on Wednesday, decisively breaking above a key medium-term resistance at ₹120. This rally has strengthened the short-term uptrend that has been since the stock took support in the band between ₹90 and ₹93 in early April this year. Investors with a a short-term view can buy the stock at current levels.

The significant medium-term support in the band between ₹90 and ₹93 had provided base in late January this year. Thereafter the stock started to move sideways in the wide range between ₹90 and ₹120 until recently. With the in the sideways consolidation phase, the stock has been in a short-term uptrend from early April. The stock trades well about the 21- and 50-day moving averages. The recent up-move has reinforced the bullish momentum. The daily relative strength index features in the bullish zone and the weekly RSI has decisively entered the bullish zone from the neutral region.

The short-term outlook is bullish for the stock. It has potential to extend the up-move and reach the price targets of ₹128 and ₹131 in the coming trading sessions. Traders can buy the stock with a stop-loss at ₹119.5.

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

Published on May 20, 2021

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