Jyothy Laboratories

Investors with medium-term perspective can consider buying the stock Jyothy Laboratories (Rs 180.2). The stock has been on a steady long-term uptrend since it touched the life-time low of Rs 42, recorded in October 2008. However, after marking an all-time high of Rs 204.6 on March 8, the stock was on short-term correction. The intermediate significant support in the range between Rs 155 and Rs 160 arrested the stock's decline in late April. The long-term uptrend-line also provided support around that range. Subsequently, the stock bounced, penetrated its 21- and 50-day moving averages during early May and is trading above the averages. We notice that there is an increase in volume over the past two trading sessions. The daily relative strength index has re-entered the bullish zone from the neutral region. The week RSI has also entered the bullish zone, reinforcing bullish momentum. Moreover, both daily and weekly moving average convergence and divergence indicators are featuring in the positive territory.

We are bullish on the stock from a medium-term point of view and believe it has the potential to head higher to our price target of Rs 210 in the forthcoming weeks. Investors with medium-term perspective can consider buying the stock with stop-loss at Rs 165. Short-term traders can buy for a target of Rs 195 with stop-loss at Rs 172.

Follow up - Hindustan Construction Co (Rs 118.5)

Following volatile sessions, the stock almost ended the week around our recommended price level. We retain our medium-term bearish view with target and stop-loss indicated for this stock in the previous week; though for short-term traders the stop-loss would have triggered.


via BL