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Investors with a short-term perspective can buy the stock of Man Industries (India) at current levels. The stock has been in a long-term uptrend since taking support at around ₹45 in May 2017. However, the stock encountered a key resistance at ₹160 in mid-January and started to decline.
Following a short-term corrective downtrend, the stock found support at around ₹117 in early February and reversed direction triggered by positive divergence in daily price rate of change indicator. The stock re-tested this support and bounced up gaining 7 per cent with above average volume on Wednesday.
As the stock reverses higher from a key medium-term support level there is a possibility of the current up-move extending in the near future. The daily relative strength index has rebounded into neutral region. The daily price rate of change feature in the positive territory implying buying interest. Taking a contrarian view, the short-term outlook is bullish for the stock. It can extend the up move and hit the price targets of ₹132 and ₹135 in the near term. Traders can buy with a stop-loss at ₹124.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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