Current Observation: The stock, after registering low of Rs 794.70 in the month of July 2017, entered into a strong correction phase and the fall was arrested at the level of Rs 665, which is near to its 200-day SMA. Thereafter, the stock witnessed a pullback rally up to the level of Rs 776 and then went into correction mode from these levels and made a low of Rs 665, which led to the formation of double bottom pattern.
At present, the stock has witnessed breakout of 4-month rectangle pattern along with robust volumes. The stock has been trading above its short term moving average, i.e. 21-day SMA.
Among the oscillators, the weekly 14-period RSI has entered into bullish zone and is on a rising trajectory. The level of Rs 750 is likely to act as a strong support and this could be maintained as a stop loss for long positions. On the upside, the stock is likely to touch levels of Rs 830-850.
Conclusion: Considering the breakout of rectangle pattern and the stock trading above its 21-day SMA, we recommend buying this stock for target price of Rs 830-850 with stop loss at Rs 750 level.