Stock of the week - Buy Bharat Electronics Ltd For Target Rs. 288 By GEPL Capital
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Observation
* On Weekly chart of BEL, we can observe that prices are following a clear uptrend since June 2020 with the formation of higher top higher bottom in the prices .
* We witnessed some consolidation between a narrow range of 224 levels—191 level from August 2021 to March 2022.
* Prices gave a breakout from the above narrow range on April 2022 with high volumes, which indicated toward a start of trend in the direction of breakout.
* Post the breakout, around the level of 224 we saw change in polarity by the prices, where the prices took support from 20 Week EMA, which earlier have acted as a strong variable support for the prices.
* In the latest week, the prices gave a breakout of Symmetrical Triangle price pattern by taking support from crucial level of 224 which suggests a continuation in existing up trend.
* RSI plotted on weekly and daily time frame has sustained above 55 mark and moving upward, suggesting strong momentum in the prices.
Inference & Expectations
* By looking at the overall price structure and the evidences supported by indicators, we can infer that prices can move in the direction of the breakout.
* Going ahead we expect the stock to move higher towards 280 levels followed by 300 levels.
* We recommend to place a stop loss at the level of 224, strictly on the closing basis.
Buy BHARAT ELECTRONICS LTD at CMP: Rs 245 | Target: Rs 288 (17%)| SL: Rs 224
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