The stock of KNR Constructions extended the rally from last year and began 2021 on the strong foot. It rallied and hit a high of ₹242 by the end of January. However, the scrip was unable to go beyond that level and started to decline. After declining in February, the started to move across a sideways trend since the beginning of April. That is, the stock was largely consolidating within the price band of ₹200 and ₹220 until May, when it broke out of ₹220.
The stock that moved up since then was again held in a tight range since the beginning of July. However, on Monday, it decisively breached the resistance at ₹240 with large volume, turning the outlook positive. The price action indicate that the stock is likely to gain further.
Supporting the same, the relative strength index and the moving average convergence divergence on daily chart are showing fresh positive signs. Thus, traders can be positive and initiate fresh long positions in the stock with stop-loss at ₹257; target at ₹270.
Note: The recommendations are based on technical analysis. There is a risk of loss in trading