Essar Shipping

We recommend a buy in the stock of Essar Shipping Ports and Logistics from a short-term perspective. The stock’s 11.5 per cent jump accompanied with heavy volume on November 18 strengthened its bullish momentum. Following a medium-term up move from its multi-year low of Rs 19 to Rs 90, the stock has been consolidating sideways in a broad range of Rs 55 and Rs 75 since July. Taking key support at Rs 55, the stock has been on a short-term uptrend from the beginning of November. With the recent surge it penetrated its 21- as well as 50-day moving averages. The daily relative strength index has entered the bullish zone from the neutral zone. The daily moving average convergence and divergence indicator has signalled a buy and is heading towards the positive territory. Our short-term forecast on the stock is bullish. We anticipate it to rally breaching the sideways range until it hits our price target of Rs 78. Traders with a short-term horizon can buy the stock while maintaining a stop-loss at Rs 66.5
via BL