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The outlook for the stock of Future Retail is bullish. The stock surged 4 per cent on Wednesday breaking above the key resistance level of ₹510. Prior to this sharp rise, the stock has been range bound between ₹465 and ₹510 for about a month. Wednesday’s strong rally has broken this range indicating the resumption of the short-term uptrend that has been in place since early October.
Strong support is in ₹490-510 region which is likely to limit the downside. Intermediate dips to this support zone is likely to find fresh buyers. The stock can extend its up-move to ₹550 in the near term. A strong break above ₹550 will then increase the likelihood of the stock extending the rally towards ₹575 and ₹600 thereafter.
Traders can go long at current levels and also accumulate on dips at ₹515 and ₹505. Stop-loss can be placed at ₹490 for a target of ₹595. Revise the stop-loss higher to ₹538 as soon as the stock moves up to ₹548. The bullish outlook will get negated only if the stock declines decisively below ₹490. But such a strong fall looks unlikely at the moment.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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