Jayant Agro-Organics

We recommend a buy in the stock of Jayant Agro-Organics from a short-term perspective. It is apparent from the charts of that stock that since the December 2008 low of Rs 27.5, it has been on a long-term uptrend. However, following a medium-term corrective decline from Rs 120, the stock found long-term key support at Rs 75 in late March 2010. The corrective decline had retraced 50 per cent fibonacci retracement level of its prior up-move. Subsequently, the stock resumed its uptrend and is trading well above its 21- and 50-day moving averages. We notice good volumes during advance days of the stock in this month.

Moreover, On Tuesday, the stock surged 8 per cent accompanied with extraordinary volumes. The daily relative strength index is featuring in the bullish zone and the weekly as well as the monthly RSI have entered this zone. Both the daily and weekly moving average convergence and divergence indicators are hovering in the positive territory implying optimism. Our short-term forecast on the stock is bullish. We expect its current rally to prolong until it knocks our price target of Rs 116 in the forthcoming trading sessions. Short-term traders can buy the stock with stop-loss at Rs 102.

via BL