Technical Call: MRF - Buy

Akhil Nallamuthu |BL Research Bureau | Updated on: Jul 16, 2022

FOR INVESTMENT WORLD : MRF TYREDROME PHOTO : BIJOY GHOSH | Photo Credit: BIJOY GHOSH

The stock of MRF Limited (₹79,558) broke out of an important resistance at ₹77,000 last week. With that, it has also breached a falling trendline resistance, which was also at ₹77,000. I Thus, the stock has closed with a gain for the fourth week in a row, indicating good buying momentum. Therefore, the probability of the stock appreciating further looks high. But since it is nearing a hurdle at ₹80,000, there is a chance that the stock could witness a corrective decline from here, probably to ₹72,600 before breaking out of ₹80,000. It is then expected to rise past another resistance at ₹87,200 and rally to ₹96,000 before the end of this year.

Given the above factors, investors with a medium-term perspective can buy the stock at the current level of ₹79,558. Accumulate if the price dips to ₹72,600. Keep a stop-loss at ₹68,500 initially. Tighten it to ₹83,500 when the stock of MRF moves past the hurdle at ₹87,200. Since the price band of ₹96,000–1,00,000 can act as a roadblock, exit your holdings at ₹96,000.

Published on July 16, 2022
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