Short-term traders can look to buy the stock for a target above Rs 5,000 levels in the next 3-4 weeks, suggest experts.
The stock rose from Rs 3,405 as on 18 May 2023 to Rs 4,773 on the BSE recorded on 18 August 2023 which translates into an upside of over 40%.
The wire and cable stock with a market capitalization of more than Rs 72,000 crore on the BSE has almost doubled investors’ wealth in the last 1 year.
The momentum helped the stock to breakout from a flag pattern on the daily charts last week which has opened room for the stock to head towards Rs 5,000 level.
A bullish flag is usually formed in stocks with strong uptrends and is considered a continuation pattern. The pole is formed from the vertical rise seen in the stock price while the flag resembles the period of consolidation.
The stock has formed a strong base around Rs 4,500 while on the upside Rs 4,870 acted as a stiff resistance. The stock hit a record high of Rs 4,911 on 17th August 2023.The mild fall in stock price can be used to buy, suggest experts as the stock is in an overall uptrend.
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 on the daily charts.
“Polycab India stock is in an overall uptrend and gave a fresh Flag breakout on the daily scale after eighteen sessions which is a bullish price pattern. It is forming higher highs – higher lows from past two sessions and formed a strong bullish candle,” Arpit Beriwal, Analyst, Equity Derivatives & Technicals, MOFSL, said.
“It is holding well above its 20 DEMA and strong outperformance is seen in the Midcap space. Momentum oscillator (RSI) is above 70 zones which suggest overall strength in the stock,” he said.
“We recommend traders to buy the stock with stop loss below Rs 4,700 levels on a closing basis for an upside target towards 5150 zones in the short term,” recommends Beriwal.
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)