The short-term outlook for the stock of Aban Offshore is bullish. The stock surged 7.6 per cent on Tuesday breaking an important resistance in the ₹218-₹220 zone. This breakout rally was accompanied by strong volume that could add strength to the upside momentum. Prior to this rise, the stock was range bound in ₹190-223 zone since May. Tuesday’s sharp rally has broken this range decisively. Immediate support is at ₹225 and then the region between ₹220 and ₹223 will be a strong short-term support zone for the stock. An immediate rise to ₹240 looks likely. A strong break above ₹240 can take the stock further higher to ₹250 or even ₹255.

Traders with a short-term perspective can go long. Stop-loss can be kept at ₹221 for a target of ₹250. Revise the stop-loss higher to ₹235 as soon as the stock moves up to ₹240. The short-term outlook for the stock will turn negative only if it declines below ₹220, which is unlikely under the current circumstances. (Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)

Related Topics