Investors with a short term perspective can buy the stock of Tata Motors at current levels. The stock gained 5 per cent accompanied by above average volume, breaching both the 21- and 50-day moving averages on Monday. Following an intermediate-term downtrend, the stock took support at ₹106, recording a 52-week low. Thereafter, it began to move sideways in a wide band between ₹106 and ₹138. Within this range, the stock took base at ₹112 last week and started to trend upwards.

The breaching of key moving average has strengthened the bullish momentum. There has been an increase in daily volume over the past two months. The daily relative strength index is charting upwards in line with the stock price, in the neutral region. Moreover, the weekly RSI has entered the neutral region from the bearish zone. Other indicators in the daily chart are also charting upwards.

The break above the 21- and 50-day moving averages as well as an immediate resistance at ₹122 is positive for the stock from a short term perspective. The stock can continue to trend upwards and reach the price targets of ₹133 and ₹136 in the ensuing trading sessions. Buy the stock with a stop-loss at ₹124.5.

(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)

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