Technical Analysis

Gayatri Projects: Buy

Yoganand D | Updated on June 02, 2019 Published on June 02, 2019

The stock of Gayatri Projects gained 5 per cent, accompanied by above-average volume on Friday, to close at ₹184.1, breaking above a key medium-term resistance level of ₹175. This break-out provides investors with a medium-term horizon an opportunity to buy the stock at current levels.

Following an intermediate-term downtrend from the new high of ₹237 recorded in January 2018, the stock found support at around ₹150 this February. Subsequently, the stock began to consolidate in the ₹150-175 band for almost three months.

The recent rally also helped the stock move out of this sideways range in the upward direction. Moreover, it has breached its 200-day moving average poised at ₹175 and trades well above the 50 as well as 200-day moving averages. Short-term trend is up. The daily relative strength index has entered the bullish zone from the neutral region and the weekly RSI is on the brink of entering this zone from the neutral region, indicating bullish momentum.

Besides, the daily as well as the weekly price rate of change indicators feature in the positive terrain, signalling buying interest. With the conclusive break-out of the key resistances at ₹175, the stock is set to trend upwards. The medium-term outlook is bullish for Gayatri Projects. The price targets are ₹200 and ₹21 with a minor pause at around ₹200. which is a key resistance. Traders with a medium-term view can buy the stock with a stop-loss at ₹171.

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