The stock of VIP Industries gained 3.4 per cent accompanied by above-average volume on Friday, decisively surpassing the 21-day moving average.

With this rally, the stock surged 5.2 per cent last week and appears to have resumed the uptrend.

Investors with a medium-term horizon can buy the stock at current levels. Following a sharp fall in February and March this year, the stock registered a 52-week low at ₹187.9 in late March.

Subsequently, it changed direction, triggered by positive divergence on the daily relative strength index (RSI).

Since then, the stock has been trending upwards. In late May, it took support at ₹203 and continued to trend upwards. But it then encountered a key resistance at ₹270 and started to move sideways with a positive bias.

It trades well above the 21- and 50-day moving averages.

The daily RSI has entered the bullish zone from the neutral region, implying buying interest and the weekly RSI hovers in the neutral region.

Moreover, the daily and the weekly price rate of change indicators are featuring in the positive terrain, indicating buying interest.

Notably, the price action since early June has the formation of an ascending triangle chart pattern, which is a continuation pattern. A decisive break above the current flat resistance at ₹270 can strengthen the uptrend and push the stock northwards.

In that case, it has the potential to trend upwards to reach the price targets of ₹290 and ₹310 in the medium term with a minor pause at around ₹300.

Investors can buy the stock with a stop-loss at ₹250.

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