Today’s pick is AMBUJACEM [stockquote]AMBUJACEM[/stockquote]. The stock started an uptrend in June, after a range-bound start for the year. After reaching its 52 week high of Rs. 223/- in October, the stock has been under a pennant formation. In the last three months, the stock is up 8% vs. 7% of the Nifty’s.
Oscillators RSI and CMO are in no man’s land suggesting no direction for the stock.
The MACD line and the signal line are moving close to each other – directionless. Also, both long-term and short-term GMMA lines are too constricted to give any signal. Short-term technical gave a 18×4 bearish signal for the stock yesterday.
AMBUJACEM’s average correlation of 0.52 with the Nifty is positive. The stock will replicate the movements of Nifty. [stockquote]NIFTYBEES[/stockquote]
AMBUJACEM has a historical volatility in the range of 0.3 to 0.8. The scrip’s volatility currently is in the lower range.
To conclude, given these technicals, the stock is a short-term HOLD. For the long-term a directional bet could be made once we see a break-out of the pennant so we suggest a long-term HOLD.
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