Investors with a short-term perspective can buy the stock of Action Construction Equipment at current levels. The stock recorded a 52-week high at ₹175.9 in early March this year and started to decline. Thereafter the stock continued to trend downwards and had been on a short-term downtrend until it found support at around ₹140 in last week.
The base at around ₹140 cushioned the stock this week also the stock began to move higher. On Tuesday, the stock jumped 7 per cent accompanied by above average volume, it surpassed its 21-day moving average and a key medium-term resistance at ₹150. This up-move has strengthened the bullish momentum.
The daily relative strength index is charting higher in the neutral region towards the bullish zone and the weekly RSI has re-entered into the bullish zone. Besides, the daily price rate of change indicator has entered the positive terrain implying buying interest. The short-term outlook is positive for the stock. It can continue to trend upwards and reach the price targets of ₹159 and ₹162 in the coming trading sessions. Traders with a short-term view can buy with a stop-loss at ₹149.5.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)