Eveready Industries

We recommend a buy in the stock of Eveready Industries India from a short-term perspective. It is apparent from the charts of the stock that it has been consolidating sideways in a broad range between Rs 55 and Rs 75 since September 2009. From a long-term perspective, the lower boundary level Rs 55 is a significant support level. The stock took support from this lower boundary in May 2010 and started to move up. While trending up the stock conclusively breached its 50 and 200-day moving averages in late June and is trading well above these averages. On Tuesday, the stock jumped 3.7 per cent with good volume, forming a bullish engulfing candlestick pattern. The 14-day relative strength index has re-entered in to the bullish zone from the neutral region and weekly RSI is on the brink of entering into this zone. Both daily and weekly moving average convergence divergence indicators are featuring in the positive territory. We are bullish on the stock from a short-term perspective. We anticipate the stock to move up further until it hits our price target of Rs 68 and then Rs 70 in the upcoming trading sessions. Short-term traders can buy the stock with stop-loss at Rs 64.

via BL