Todays Pick

Karnataka Bank (₹163)

Yoganand D BL Research Bureau | Updated on January 10, 2018 Published on September 20, 2017

Investors with a short-term perspective can buy the stock of Karnataka Bank at current levels. The stock gained over 5 per cent accompanied with an extraordinary volume on Wednesday, breaching a key resistance at ₹155. After a medium-term corrective decline from the 52-week high of ₹181 recorded in early June, the stock found support in the band between ₹135 and ₹140 in early August.

The stock’s 200-day moving average also provided base in this band. Since then the stock has been in a nascent short-term uptrend. While trending up, the stock has decisively breached its 21 and 50-day moving averages and hovers well above them. A near-term resistance at ₹155 which as capping the stock’s rally over last one week is emphatically breached on Wednesday. With this rally the short-term uptrend has gained strength.

The daily relative strength index has entered the bullish zone from the neutral region. The weekly RSI is on the brink of entering the bullish zone from the neutral region. The daily price rate of change and moving average convergence divergence indicators feature in the positive territory, implying buying interest. The short-term outlook is bullish for the stock of Karnataka Bank. Traders can buy the stock with a stop-loss at ₹159.5. Short-term targets are ₹170 and ₹173.

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

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