Today's Pick - NALCO

We recommend a buy in National Aluminium Company from a short-term perspective. The stock has been on a long-term uptrend from its August low of Rs 237. However, after recording an all-time high at Rs 565 in May 2008, the stock recorded a healthy pull back retracing 38 per cent fibonacci retracement level of the prior uptrend.

On June 5, the stock jumped up more than 4 per cent, taking support for the medium-term up trendline at around Rs 465. The 50-day moving average that is hovering around Rs 465 level has also provided support for the stock. The daily relative strength index is rising in the neutral region towards the bullish zone and the weekly RSI is featuring in the bullish zone.

Considering that the long and medium-term up trendline are intact, we are bullish on the stock in the short-term horizon. We expect the stock to move up until it hits our price target of Rs 555 in the upcoming trading sessions. Traders with short-term perspective can buy the stock while keeping the stop-loss at Rs 476 level.

via BL