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Investors with a short-term perspective can buy the stock of Future Retail at current levels. The stock found support at ₹417 in mid-January 2019, after a short-term downtrend from the December 2018 high of ₹574. Subsequently, the stock changed direction triggered by positive divergence in the daily relative strength index and moving average convergence divergence. Key long-term support in the band between ₹417 and ₹423 cushioned the stock in late January.
On Monday, the stock gained 4 per cent and has closed above its 21-day moving average line. The daily relative strength index has entered the neutral region and the weekly RSI has also entered the neutral region from the bearish zone. The daily price rate of change indicator is displaying positive divergence backing the stock’s trend reversal.
Taking a contrarian stance from a short-term perspective, the stock has the potential to extend the upmove in the coming trading sessions. Surpassing the immediate resistance at ₹450, the stock can reach the price targets of ₹463 and ₹472 in the short-term. Traders can buy the stock with a stop-loss at ₹435.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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