The valuations of Meghmani Organics looks attractive, Can I enter at the current price for the long term?
BUY AT CURRENT PRICE WITH STOP LOSS OF RS 50 ON A WEEKLY CLOSING BASIS.
Meghmani Organics Ltd is currently trading at Rs 56.05. Its 52-week high/low stand at Rs 126/Rs 55 made on January 10, 2018 and November 9, 2018, respectively. The stock, after witnessing a strong upmove from the lower level of Rs 18.25 in February 2016 to the level of Rs 129.40 in November 2017, had spent a major part of the calendar year 2018 in a correction zone which is likely to halt in the coming weeks. Considering the weekly scale, the stock has strong support zone at Rs 55-Rs 50 as its crucial long term moving average, i.e. 200-week SMA is placed there and it coincides with 61.8 per cent Fibonacci retracement level of the entire upward move started from the low of October 2013 to its all-time high in November 2017. On the daily scale, all the indicators and oscillators are in the oversold zone. Considering all these factors, we recommend you to buy at the current price with stop loss of Rs 50 on a weekly closing basis.