Technical Analysis

Stock pick of the week: Rallis India

Yoganand D | Updated on November 24, 2019

The stock of Rallis India gained 3.7 per cent on Friday accompanied by an above- average volume, breaking above a key long- term resistance at ₹180.

For the week, the stock surged 7.7 per cent, backed by good volume. This rally provides investors with a medium-term perspective and an opportunity to buy the stock at current levels.

Following an intermediate-term downtrend, the stock registered a 52-week low at ₹139 in May and changed direction, triggered by positive divergence in the daily relative strength index (RSI).

It took support at ₹140 in June and continued to trend upwards.

Since then, the stock has been in a medium- term uptrend. In early September, the stock decisively breached its 200-day moving average, and hovers well above it. The short-term trend is also up. Both the daily and the weekly RSI are featuring in the bullish zone, backing the stock’s rally.

Likewise, the daily as well as the weekly price rate of change indicators are hovering in the positive terrain, implying buying interest. Besides, there has been an increase in the daily volume over the past six trading sessions. Overall, the medium-term outlook is bullish for Rallis India.

The stock has the potential to trend upwards and reach the price targets of ₹200 and ₹215 in the medium term, with a pause at around ₹200. Investors can buy with a stop-loss at ₹175.

Published on November 24, 2019

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