Ranbaxy Labs

We recommend a buy in Ranbaxy Laboratories from a short-term trading perspective. The stock was on a medium-term correction from its June high of Rs 311 to Rs 240. This correction halted at the twin support at Rs 240 (a long-term key support level and intermediate-term up trendline). After taking support from this level, the stock resumed its intermediate up trend which has been intact since March low of Rs 133 (a 52-week low). The stock is trading way above its 50-day moving average. Moreover, the stock has breached its moving average congestion (21, 50 and 200 day) around Rs 250. The price rate of change (ROC) indicator has entered into the positive territory from the negative territory signalling buying interest. Both daily and weekly relative strength index (RSI) are heading to the bullish zone. We are bullish on the stock from a short-term trading perspective. We anticipate the stock to move up further until it hits our price target of Rs 284 in the upcoming trading sessions. Traders with a short-term perspective can buy the stock while maintaining a stop-loss at Rs 247.

via BL