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Investors with a short-term perspective can consider buying the stock of TVS Motor Company at current levels. The stock took support at around ₹340 and bounced up gaining 6.6 per cent accompanied by above average volume on Wednesday. It has formed a bullish engulfing candlestick pattern in the daily chart which is a bullish reversal pattern. Also, the daily relative strength index is displaying positive divergence backing the trend reversal and has recovered from the oversold territory.
The daily RSI is likely to enter the neutral region from the bearish zone. There has been an increase in daily volume over the past one week. Both medium- as well as short-term trends are down. But, the stock appears to have taken support at ₹340 recently and changed direction.
Taking a contrarian view, the short-term outlook is bullish for the stock. It has the potential to trend upwards and reach the price targets of ₹383 and ₹390 in the ensuing trading sessions. Traders with a short-term view can buy the stock with a stop-loss at ₹359.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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