Shipping Corporation

We recommend a 'buy' in the Shipping Corporation of India from a short-term horizon. It is clearly visible from the charts of Shipping Corporation that after finding support at Rs 70 in early March, a significant long-term support level, it bounced up. Since its March low, the stock has been on a medium-term uptrend. However, in mid-April the stock encountered resistance at around Rs 98 and witnessed a pull back to Rs 81, retracing 61.8 per cent (Fibonacci retracement) of its prior up move. Subsequently, the stock resumed its medium-term uptrend taking support from the up trendline recently. The stock is trading well above its 21 and 50-day moving averages. We notice that the volumes are high during the advance days. The daily relative strength index (RSI) has re-entered into the bullish zone from the neutral levels. The weekly RSI is gradually rising in the neutral region towards the bullish zone. Our short-term outlook is bullish on this stock. We expect the stock to move up until it hits our price target of Rs 102 in forthcoming trading sessions. Traders with short-term trading perspective can buy the stock while maintaining a stop-loss at Rs 87.

via BL