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Technical Stock Pick: Buy Bharat Financial Inclusion between 680 and 716 with closing stop-loss of 640

HDFC Sec | 25 Jan, 2017  | Follow Author | Add to my Favourites 
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Observations:


After falling from a high of 926 (Touched in October 2016), Bharat Financial found support around the 465 levels which also roughly corresponds to previous intermediate lows of the stock tested in March 2016.


The stock has been steadily rising in the last few weeks and making higher tops and higher bottoms in the process. Today, the stock broke out of recent intermediate high of 691 on the back of huge volumes. This suggests a reversal of the recent intermediate downtrend (See the chart above).


Technical indicators are currently giving positive signals as the stock trades above the short term (13 day SMA), medium term (50 day SMA) and long term (200 day SMA) moving averages. Momentum indicators like the 14-day RSI are in rising mode and not yet overbought. The 14-day RSI also trades above its 9-day EMA, which is a positive signal.


We believe the stock has the potential to move higher in the coming weeks and months as it attempts to test its previous intermediate highs of 829 and 926. We therefore recommend a buy at CMP and adding more on dips. Our entry levels, along with stop loss and targets have been mentioned above.



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About HDFC Sec

HDFC Securities a trusted financial service provider promoted by HDFC Bank and JP Morgan Partners and their associates, is a leading stock broking company in the country, serving a diverse customer base of institutional and retail investors. HDFCsec.com provides investors a robust platform to trade in Equities in NSE and BSE , and derivatives in NSE. Our website will support you with the highest standards of service, convenience and hassle-free trading tools.


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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.




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Punit Jain
Founder - JainMatrix Investments - JainMatrix Investments