Aditya Birla Capital Ltd, part of the financial services segment, bounced back from its long-term moving average after hitting a 52-week high back in July 2023 and price action suggests that bulls are here to stay.

Short-term traders with a high-risk profile, can look to buy the stock now or on dips for a possible target above the crucial resistance level of 200 in the next 1-2 months, suggest experts.

The stock hit a 52-week high of Rs 199.40 on 3rd July 2023, but it failed to hold on to the momentum. The stock witnessed a price-wise and time-wise decline since then.

The stock bounced back from its 200-DMA earlier in February 2024 and if the momentum continues, it will try to retest 200 levels.

Levels around 200 acted as a stiff resistance in the past. The stock slipped below 200 back in November 2017 and since then it has not been able to reclaim the level.

A close above 200 will add further momentum to the stock which could take it towards 210 levels, suggest experts.In terms of price action, the stock is trading well above most of the crucial short- and long-term moving averages such as 5,10,30,50,100 and 200-DMA which is a positive sign for the bulls.

The daily Relative Strength Index (RSI) is placed at 61.1. RSI below 30 is oversold and above 70 is considered overbought, Trendlyne data showed. The daily MACD is above its center and signal Line, this is a bullish indicator.

The financial services sector has shown signs of improvement, with NBFC stocks gaining momentum.

“AB Capital, in particular, has demonstrated a noteworthy finding as it has regained stability at a horizontal support line, which coincided with its 100-week moving average and a 38.2% retracement of its earlier rise,” Kapil Shah, Technical Analyst, Emkay Global Financial Services Limited and Trainer at FinLearn Academy, said.

“This stock has broken out of its falling channel and is exhibiting a higher high and higher low sequence. Upon analyzing the daily chart, it is evident that the stock is trading above its short to long-term moving averages, indicating positive momentum,” he said.

“Based on the above insights, it is recommended to purchase the stock at the 188 to 184 level, with a stop loss at 175. The potential upside for this stock could reach up to the 210 level,” recommended Shah.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)

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