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The short-term outlook of Torrent Power is bullish. The 3.86 per cent on Monday, the stock well above the 200-Day Moving Average is currently at ₹509. Below this there is resistance-turned-support trendline at ₹500. The downside is likely to be limited to ₹500 in case if the stock declines below ₹509 – the 200-DMA. The charts indicate the upmove has been in place since mid-May is very well intact and has gained momentum. As such, dips to ₹509 or ₹500 are likely to get fresh buyers coming into the market.
The stock has potential to rise towards ₹550-₹560 in the next two-three weeks. Traders can go long at current levels. Accumulate longs at ₹511. Keep the stop-loss at ₹497. Trail the stop-loss up to ₹522 the stock moves up to ₹529. Move the stop-loss further up to ₹534the stock touches ₹541 on the upside. Book profits at ₹547. The ₹550-₹560 is a strong resistance from the stock can reverse lower again. The bullish outlook will get negated if the stock declines below ₹500. But that looks less probable as seen from the charts.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)
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