BGR Energy Systems

We recommend a buy in BGR Energy Systems from a short-term trading perspective.

It is clearly visible from the charts of the stock that after recording an all-time low of Rs 115 on December 2, it began to trend upward. This trend reversal was triggered by the stock’s prolonged positive divergence displayed in the weekly relative strength index (RSI). Since then, the stock has been on a medium-term uptrend. While trending up, it breached its 21- and 50-day moving averages recently.

Furthermore, the stock is trading well above these averages. Reinforcing the bullish momentum, the stock jumped by 10 per cent on January 6. We notice that there is an increase in volume over the past three trading sessions. The daily RSI has entered the bullish zone and the weekly RSI is on the verge of entering the neutral region from the bearish zone. Our short-term forecast for the stock is positive. We expect the stock’s uptrend to prolong until it hits our price target of Rs 202 in the forthcoming trading sessions. Traders with short-term perspective can buy the stock while maintaining a stop-loss at Rs 172.

via BL