Investors with a short-term view can buy the stock of JK Tyre & Industries at current levels. Following a short-term downtrend the stock found support in late March this year at ₹98 and began to trend upwards. Thereafter in April the stock formed a base at around ₹103 and it continued to trend upwards. The stock breached key resistances at ₹120 and ₹130 while trending up in mid-May and early June respectively. However, the stock recorded a 52-week high at ₹156.5 in mid-June and was on a corrective decline until it took support at ₹134 this week.
On Thursday, the stock gained 5 per cent with above average volume, breaching a key resistance at ₹140 as well as the 21-day moving average. The daily relative strength index is likely to enter the bullish zone from the neutral region and the weekly RSI continues to feature in the bullish zone backing the uptrend. Also, the weekly price rate of change indicator hovers in the positive territory.
With the resumption of the up-move and the closing above a key resistance level of ₹140 the stock has potential to trend upwards and reach the short-term price targets of ₹149.5 and ₹152.5 in the forthcoming trading sessions. Traders can buy the stock with a stop-loss at ₹140.
(Note: The recommendations are based on technical analysis. There is risk of loss in trading.)