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The outlook for the stock of Motherson Sumi Systems is bullish. The stock rose 2.5 per cent on Tuesday breaking above a key resistance level of ₹340. The stock has closed just above ₹340 and this level may now serve as a good near-term support. The next key support is at ₹337. The downside is expected to be limited to ₹337 if the stock breaks below ₹340 in the near-term.
The strong surge on Tuesday confirms the resumption of the uptrend that has been in place since late August. It also keeps the long-term uptrend intact. A revisit of the previous high of ₹345 is likely in the coming days. The possibility is high of the stock breaking above this level and surging to record highs. Such a break can take the stock higher to ₹355 or ₹360 in the coming days. Traders with a short-term perspective can go long. Stop-loss can be placed at ₹334 for the target of ₹355. Accumulate longs on dips near ₹339. Revise the stop-loss higher to ₹345 as soon as the stock moves up to ₹349.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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