Ambuja Cements

We recommend a buy in Ambuja Cements from a short-term perspective. It is evident from the charts of Ambuja Cements that it has been on an intermediate-term up-trend, forming higher peaks and higher bottoms since its October 2007 low of Rs 43. This low is also its 52-week low. In early April the stock emphatically penetrated its 200-day moving average and is currently trading way above this average. On May 20, the stock surged 7 per cent with good volume breaking through a long-term resistance level of Rs 90. Besides, the stock reinforced the up-trend by gaining 7 per cent on June 1. We observe that there is an increase in volumes over the past three trading sessions. Both daily and weekly relative strength indices (RSI) are featuring in the bullish zone. The weekly moving average convergence and divergence has entered the positive territory. The intermediate-term up-trendline is intact. Though the stock is facing minor resistance at Rs 100, we are bullish on the stock and expect it to surpass this resistance in the near future. Traders with short-term trading perspective can buy the stock while maintaining a stop-loss at Rs 93 and with target of Rs 109.

via BL