Chart Focus - Trent: Buy

Investors with a medium-term horizon can consider buying the stock of Trent at current levels. The stock is in an uptrend across all time frames — long, medium and short-term. Within the long-term uptrend, the stock had been in a sideways consolidation phase in a broad range between ₹320 and ₹370 since July 2018. On Friday, it jumped 4.8 per cent with good volume, decisively breaking above the key resistance level of ₹370, and closed at ₹384. It trades well above 50- and 200-day moving averages. Short-term trend has gone up after this breakout.

 

There has been an increase in daily volume over the past three trading sessions. The daily relative strength index has entered the bullish zone from the neutral region and the weekly RSI has also entered the bullish zone from the neutral region, implying bullish momentum. Moreover, the daily as well as the weekly price rate of change indicators features in the positive terrain, indicating buying interest.

With the continuation of the long-term uptrend, a conclusive break above the key medium-term resistance level is positive for the stock. The medium-term outlook is bullish for Trent and has the potential to trend up in the coming weeks. The price targets are ₹415 and ₹440 with a minor pause at around ₹420. Traders a medium-term view can buy the stock with a stop-loss at ₹360.

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