The share price of McLeod Russel hit a lifetime high of Rs 386 during February 2013. Thereafter, it entered a corrective mode driven by profit bookings at the all-time highs. The corrective decline over the past eight months saw the stock price taking support at the 61.8% Fibonacci retracement (246) of the last major up leg from December 2011 low of Rs 165 to - February 2013 high of Rs 386. Incidentally, the August–September 2013 lows of around Rs 245 also rest upon the long term rising trend line formed by connecting the major lows of February 2009 and December 2011. The confluence of the 61.8% (Golden Fibonacci ratio) retracement and the long term rising demand line around Rs 245 saw the corrective decline get arrested near the major support area.
After hitting a low of Rs 246 during late August 2013 the stock price went into consolidation mode over the next three months in the range of Rs 291-246. From a technical perspective, the consolidation taking shape precisely near the key support is seen as accumulation from long term investors within the larger bull trend. The price action over the last couple of weeks has seen the stock break out of the three month long consolidation range (Rs 291-246) above Rs 291. Therefore, this signals resumption of bullish momentum.
The volume behaviour is also in line with the Dow Theory principle, as the price consolidation was a low volume affair while the break out above Rs 291 was on the back of strong volumes. Average daily volumes during consolidation had been around 2 lakh shares while the break out witnessed volumes of nearly 14 lakh shares indicating strong participation in direction of the trend.
Following the breakout above Rs 291 in the current month, we expect the stock to resume its northward journey and head towards Rs 336 over a medium term horizon. The measuring implication of the range breakout (Rs 291-246= 45) added to the breakout level of Rs 291 (291+45=336) projects a target of Rs 336 levels.
Strategy: Buy McLeod Russel in the range of Rs 306 - 301 for a target of Rs 335 with a stop loss below Rs 286 on a closing basis.
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Anda sedang membaca artikel tentang
Buy Mcleod Russel; target of Rs 335: ICICIdirect.com
Dengan url
http://harmonisem.blogspot.com/2013/12/buy-mcleod-russel-target-of-rs-335.html?m=0
Anda boleh menyebar luaskannya atau mengcopy paste-nya
Buy Mcleod Russel; target of Rs 335: ICICIdirect.com
namun jangan lupa untuk meletakkan link
Buy Mcleod Russel; target of Rs 335: ICICIdirect.com
sebagai sumbernya
0 komentar:
Posting Komentar