Rashtriya Chemicals & Fertilizers (₹82.7)

The stock of Rashtriya Chemicals & Fertilizers has gained 4.8 per cent with extraordinary volume on Monday, breaching a key resistance at ₹80. This rally gives investors with a short-term perspective an opportunity to buy the stock at current levels. The stock has been on an intermediate-term uptrend since taking support at ₹40.5 in November 2016. However, after recording a multi-year high of ₹99.7 in this May, the stock started to decline and had been on a medium-term downtrend until it found support at ₹75 in July.

The significant support at ₹75 has been providing base for the stock from late May. Last week, the stock tested this support and gained 4.6 per cent. Reinforcing this bullish momentum, the stock advanced on Monday as well. The daily relative strength index has entered the bullish zone from the neutral region and the weekly RSI is on the brink of entering the bullish zone.

The daily price rate of change indicator is featuring in the positive territory implying buying interest. The intermediate-term uptrend is intact for the stock. The near-term outlook is bullish. The stock can continue its current bullish momentum and reach the price targets of ₹86 and ₹88 in the ensuing trading sessions. Traders can buy the stock with a stop-loss at ₹80.7.

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

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