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The outlook for the stock of Birlasoft (₹467) is bullish. The stock has been in a strong uptrend since March 2020. The corrective fall within this uptrend that began in January this year halted by the end of February. On the daily chart, the price action since the last week of January indicates an inverted head and shoulder pattern. This is bullish and signals the reversal of the recent correction. Clusters of support is poised in the ₹455-₹440 region.
A much deeper support is at ₹400-₹390. As such any intermediate falls can be limited to either ₹440 or to a low of ₹400-₹390 at the most. The stock can target ₹700-₹720 by this year end or in the first quarter of next year.
Investors with a medium-term perspective can buy this stock at current levels. Accumulate the stock on dips at ₹445 and at ₹410 in case the fall extends beyond ₹440. Keep a stop-loss at ₹375. Trail the stop-loss up to ₹520 as soon as the stock moves up to ₹585. Move the stop-loss further up to ₹610 as soon as the stock touches ₹680. Book profits at ₹710.
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