Today’s pick is [stockquote]LT[/stockquote]. The up-trend in place since December last year was punctuated by a correction in March through May. The stock has since resumed its upward trajectory to reach a 52 week high of 1700 recently. In the last three month period, the stock is up 18% vs. 8% for Nifty.
Long term set of GMMA lines are fanning out – which is a bullish for the long term. Due to the recent down-trend in the stock prices the short-term lines are constricting, giving a bearish signal for the short-term.
Added to all the current technical levels, we can see a divergence in RSI, CMO and MACD levels. The higher highs in the prices are accompanied with the lower highs of the technicals which is a near-term bearish sign for the stock.
LT had a historical volatility in the range of 0.3 to 0.8. Current volatility of the stock should not be sign of panic for the traders.
In a couple of insider trading instances between 25th through 29th Oct, right around when the stock was making its 52 week highs, the Chairman, Mr. Naik, sold a total of Rs. 10.1 Cr worth of shares.
Looking at these technicals a short-term hold is suggested. Although for the long-term, the GMMA lines are giving a bullish signal for the stock.