The stock movement since September 2008 till date has faced resistance at the downward sloping trendline. The daily momentum indicators like RSI and MACD are exhibiting positive divergences, indicating a strong possibility of a break out above the resistance trendline.
The stock has witnessed significant value erosion (down 85%) from its all time high of Rs1,140, registered during December’07.
The stock touched its 52-week low of Rs164 during October’08 end and since then has held on to the crucial support levels of Rs200-205. Daily candlestick chart suggests formation of multiple bottoms at the Rs200 on a closing basis.
We recommend traders to BUY the stock at current levels and on declines with a stop loss of Rs218 for target of Rs255-265.