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Investors with a short-term horizon can buy the stock of Nelco at current levels. The stock has jumped 5.6 per cent accompanied by extraordinary volume on Thursday, decisively breaching the short-term down trend-line. In early February, the stock encountered a key barrier at ₹240 and was on a short-term downtrend until it took support at ₹180, a significant long-term base level. Subsequently, the stock changed direction and has been in a near term uptrend. It has breached its 21-day moving average in the past session and now tests the 50- as well as 200-day moving averages with an upward bias.
The daily relative strength index is on the brink of entering the bullish zone from the neutral region and the weekly RSI charts higher in the neutral region. The near-term up-move is getting strong and the stock has potential to surpass the current resistance at ₹200 and trend upwards. The short-term targets are ₹210 and ₹214 levels. Traders with a short-term view can buy with a stop-loss at ₹196.5 levels.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)
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