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The outlook for the stock of Clariant Chemicals is bullish. The stock has been on a strong uptrend since late March. This rally since March confirms the reversal of the downtrend that was in place since early 2015. The stock rose 2.9 per cent on Tuesday in spite of the broader benchmark indices closing on a negative note. Prior to this rise, the stock had consolidated between ₹725 and ₹740 for almost three weeks. Tuesday’s rise has broken this range decisively. Immediate support is in the band between ₹752 and ₹750. A rise to ₹800 and ₹815 – the 50 per cent Fibonacci retracement resistance level, looks likely.
Traders with a short-term perspective can go long. Stop-loss can be placed at ₹745 for a target of ₹795. Accumulate longs on dips near ₹755 and ₹750. Revise the stop-loss higher to ₹775 as soon as the stock moves up to ₹783. The outlook for the stock will turn negative only if it declines decisively below ₹725.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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