Balrampur Chini Mills (₹165.2)

Investors with a short-term perspective can consider buying the stock of Balrampur Chini Mills at current levels. The stock has been in an intermediate-term uptrend since taking support in the band between ₹100 and ₹105 in early November 2016. Moreover, the medium-term trend is also up for the stock.

After recording a multi-year high of ₹182 last month on September 13, the stock started to decline. This corrective fall found support at ₹156 last week, after retracing 61.8 per cent fibonacci retracement level of the prior uptrend. Triggered by positive divergence in the daily relative strength index and price rate of change indicator, the stock reversed direction. On Tuesday, the stock gained 5.5 per cent with an above average volume, breaching an immediate resistance at ₹160. There has been an increase in daily volume over the past six trading sessions.

The daily RSI has entered the neutral region from the bearish zone. The weekly RSI is also featuring in the neutral region with positive bias. Near-term outlook is bullish for the stock. It can continue to move higher and reach the price targets of ₹172 and ₹175.5 in the coming trading sessions. Buy the stock with a fixed stop-loss at ₹161.5.

(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)

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