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Investors with a high-risk appetite can buy the stock of Idea Cellular. The stock has been on a long-term downtrend ever since recording a new high of ₹203 in April 2015. The stock decisively breached a key long-term support at ₹100 in early August this year and continued its downtrend. However, it found support after registering a 52-week low at ₹66 on November 11.
Subsequently, the stock started to reverse direction triggered by positive divergence in the daily and weekly indicators. On Tuesday, the stock jumped 4.4 per cent accompanied by above average volume, conclusively breaching its 21- and 50-day moving averages. The daily relative strength index has entered the bullish zone and weekly RSI has entered the neural region from the bearish zone. There are initial signs of short-term trend reversal. Taking a contrarian stance we are bullish on the stock from a short-term perspective. It can reach the price targets of ₹82.5 and ₹84.5. Buy the stock with a stop-loss at ₹77.5.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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