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The outlook for the stock of SpiceJet is bullish. The stock had surged 6.8 per cent on Friday and extended its rally by another 1.8 per cent on Monday. The strong surge in the last two trading sessions has taken the stock well above ₹135, a key resistance.
The price action from the last week of June indicates a cup and handle pattern formation on the chart. This is a bullish continuation pattern. The strong break above ₹135 has confirmed this pattern. The level of ₹135 will now serve as a good support for the stock. Dips to this level may find fresh buyers coming into the market. A rally to ₹146 is likely in the near term.
A strong break above it can take the stock further higher to ₹150 and ₹155 in the short term. Traders with a short-term perspective can go long. Stop-loss can be placed at ₹133.5 for the target of ₹154. Revise the stop-loss higher to ₹143 as soon as the stock moves up to ₹146.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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