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The stock of Gujarat Gas declined in January this year from about ₹395 to ₹350. Since ₹350 is a strong support, it regained positive momentum and started strengthening. The stock rallied and broke above the ₹400-mark in the first week of February and reached the ₹560-level in March. Unable to rise beyond that level, the stock started to consolidate. It was largely oscillating between ₹500 and ₹560 between March and May.
Nevertheless, during the first week of June, the stock began appreciating quickly. Accompanied by significant volume, the scrip rallied and broke out of the resistance at ₹560 and crossed the ₹600-mark before a couple of weeks. The uptrend continued and the stock registered a fresh lifetime high of ₹687 on Monday. It seems to maintain the upward momentum, and this is substantiated by the relative strength index and the moving average convergence divergence indicators, which are in their respective bullish zones. Hence, there is more upside potential. Therefore, traders can buy the stock with a stop-loss at ₹665 for a target of ₹715.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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