Geodesic

Investors with a medium-term perspective can consider buying the stock of Geodesic (Rs 103.6). The stock has been on an intermediate-term downtrend from its September 2009 peak of Rs 158, forming lower peaks and lower troughs.



In May 2010, the stock's downtrend accelerated after encountering significant long-term resistance at Rs 130. However, the stock halted in the support band between Rs 75 and Rs 80 in late July and bounced up sharply. A positive divergence shown in the daily moving average convergence divergence oscillator supports this reversal. Since the July low of Rs 75, the stock has been on a short-term uptrend with 38 per cent gain. We notice good volume during the advance sessions of the stock's ongoing rally.

While trending up, the stock penetrated its down trend-line initially and then decisively penetrated 21 and 50-day moving averages reinforcing the bullish momentum. The stock is currently pausing between Rs 100 and Rs 110.

The daily relative strength index is hovering around 60 levels and weekly RSI is steadily rising in the neutral region towards the bullish zone. The daily MACD is featuring in the positive territory and the weekly indicator has signalled a buy.

Our medium-term forecast on Geodesic is positive. We believe that it has the potential of rallying towards our medium-term price target of Rs 122. Investors with medium-term horizon can buy the stock while maintaining stop-loss at Rs 93.

Follow up: Crew B.O.S Products (Rs 114.3)

After reaching an intra-week high of Rs 120.2, the stock declined and is pausing just above our recommended price level. We reiterate our bullish short- and medium-term outlook on the stock. Medium-term investors can remain invested with stop at Rs 100 and target of Rs 135.

via BL