Stock of the week - Indian Bank Ltd For Target Rs.240 By GEPL Capital
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Indian Bank
Observation
* INDIANB on the monthly time frame can be seen moving higher since June 2020, indicating that the long term trend of the stock remains bullish.
* On the week charts, the stock has given a ‘Triangle pattern’ breakout with huge volume confirmation couple of weeks back, however in the last week we have seen a follow through of the breakout and the stock has made fresh 52 week high which confirmed the strong bullish undertone of the stock for the medium to long term.
* The Bollinger bands plotted on the weekly time frame is currently expanding as the prices ride the upper band, indicating expanding volatility in the breakout.
* On the indicator front the RSI plotted on the weekly chart managed to sustain above the 50 mark when the stock was in a prolonged sideways trend. Currently it can be seen moving higher, indicating increasing bullish momentum in the prices.
* Going ahead the 210 (Multiple touch point level and 100% extension level of the rise from 41.55-157 projected from 96) is going to act as a resistance level, if the prices breach above the 210 mark we might see the prices move higher towards the 240 (Potential Target of Triangle pattern breakout).
* The 153 (Weekly low) will act as a support level, post which we might see the prices move lower towards 138 (20 Week SMA).
Inference & Expectations
* INDIANB from a long term perspective seems to be in a strong bullish trend.
* The technical parameters and the indicators mentioned above, point towards the bulls have a complete control over the trend for the medium term prospective.
* We expect this momentum to take the prices towards 210 followed by 240 levels eventually.
* On the downside the 153 mark will act as a support level if the 153 level is breached we might see the prices move lower towards 138 mark.
* One can buy INDIANB at current levels with a target of 210 and 240 with a strict stop loss of 153 on closing basis.
Indian Bank Ltd . LTP : ₹182.50 Target: ₹240 Stop Loss : 153
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