ETC Networks

We recommend a buy in the stock of ETC Networks from a short-term perspective. It is apparent from the charts that the stock found support at Rs 50, a key long-term support level in March, and reversed direction. Since then it has been on an intermediate-term uptrend. Following a short-term correction, the stock resumed its intermediate-term uptrend from the middle of July. Later on, it breached its 50-day moving average and is trading well above it. The stock broke through a key medium-term resistance at Rs 150 by jumping 10 per cent with above average-volume on September 29. Both daily and weekly relative strength indices (RSI) are featuring in the bullish territory. The daily moving average convergence and divergence indicator has signalled a buy and is hovering in the positive territory. Considering that the intermediate-term up trendline of the stock is intact, we are bullish from a short-term horizon. We expect the stock to rally until it hits our price target of Rs 174. Traders with a short-term perspective can buy the stock while maintaining a stop-loss at Rs 150.

via BL