The outlook for the stock of Radico Khaitan is bullish. The stock surged over 7 per cent on Tuesday breaking above a key resistance level of ₹420. The strong surge on Tuesday has broken the narrow sideways consolidation that was in place for about a week. It also indicates the resumption of the uptrend that has been in place since October.
The indicators on the chart are also bullish. The 21-day moving average has turned around and is on the verge of crossing over the 200-day moving average. This is a positive signal indicating that the downside could be limited in the near term. Support is in the ₹420-₹410 region. Intermediate dips to this support zone may find fresh buyers coming into the market.
The current up-move can extend to ₹460 in the coming days. A further break above ₹460 will then increase the likelihood of the stock targeting ₹585 and ₹600 thereafter. Traders can go long at current levels and also accumulate at ₹430. Stop-loss can be placed at ₹410 for the target of ₹500. Revise the stop-loss higher to ₹445 as soon as the stock moves up to ₹455.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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