Can I buy Chennai Petro at the current price?
- Paras Trivedi
BSE Code: 500110
BUY ABOVE RS 305 ON A CLOSING BASIS
Chennai Petro is currently trading at Rs 272.90. Its 52-week high/low stand at Rs 464.40/Rs 220.65 made on January 15, 2018 and October 9, 2018, respectively. After hitting 52-week low, the stock formed a small body candle carrying a long lower shadow indicating buying emerging at lower levels and this coincides with the major support as defined by the horizontal trendline. Considering the weekly time frame, the stock has reached near about the downward slopping trendline resistance zone. The stock is consistently trading below the important EMAs on the weekly time frame, i.e. 52-week EMA. The 14-period RSI on the daily time frame at present is quoting around 53 and it has been observed that since the last week of August 2018, the 14-period RSI has not been able to cross the level of 60. Considering the above factors, we would suggest you to wait and watch at the current levels and a decisive breakout above the level of Rs 305 would be a clear opportunity to buy this stock. Hence, till the stock is not able to close above Rs 305, avoid short term buying.