Alkali Metals (₹86.9)

Investors with a short-term perspective can buy the stock of Alkali Metals at current levels. The stock has been in a medium-term uptrend since marking a 52-week low at ₹52 in August 2017. Within this uptrend, the stock was in a narrow sideways consolidation phase between last October and mid-December and eventually resumed its uptrend by breaching the upper boundary at ₹77. Moreover, the stock had breached its moving average compression in mid-December implying resumption of the uptrend. But, the stock encountered a key resistance at ₹84.5 and continued to move sideways for a short span.

On Monday, the stock gained almost 8 per cent, conclusively breaching the resistance at ₹84.5 with good volume. This breakthrough indicates continuation of the uptrend and the short-term outlook is bullish for the stock. It trades well above its 50- and 200-DMAs. The daily as well as relative strength indices have entered the bullish zone implying strength. Further, the daily and weekly price rate of change indicators feature in the positive territory implying buying interest.

The stock can extend its up move and hit the price target of ₹91 and ₹93 in the short-term. Traders can buy with a stop-loss at ₹85.

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

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