We recommend a buy in Bharat Forge at current price. From the daily chart of Bharat Forge, we see that it had a steep rally from October low of Rs 260 to early November high of Rs 385. During this rally, the stock penetrated the long-term down trend-line, indicating end of the downtrend. However, after finding resistance at Rs 385, the stock has been on a short-term downtrend, which retraced 50 per cent of its prior rally, which is a Fibonacci number. The weekly moving ave rage convergence divergence is rising towards the positive region from negative territory. Immediate key resistance is at Rs 280 and the immediate key support is at Rs 290. We note that Rs 320 level is historically significant support level and 50-day moving average line coincides at this level. The stock is currently trading just above the aforementioned historic support. Short-term investors can buy the stock at current price with stop-loss at Rs 312. We expect the stock to bounce up from the significant support and rally to Rs 380 in the short-term, with minor pause around Rs 356.
Via Businessline
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