Prism Cement

We recommend a buy in Prism Cement from a short-term perspective. It is evident from the charts that after retracing 50 per cent of the stock's up move (from October 2008 low to September 2009 high), the stock found support at around Rs 36 in early November 2009. Subsequently, the stock resumed its longer-term uptrend. The stock surpassed its 21- and 50-day moving averages in mid of December and is currently trading well above them. For the past three trading sessions the stock has been heading higher accompanied by above average volumes. The daily relative strength index (RSI) is featuring in the bullish zone and the weekly RSI has entered the zone from the neutral region. Both the daily and weekly moving average convergence and divergence indicators are hovering in the positive territory, signalling signs of optimism. Our short-term outlook is bullish for the stock. We expect its upward momentum to continue until it hits our price target of Rs 56. Traders with short-term perspective can consider buying the stock while maintaining a stop-loss at Rs 48.

via BL