Today’s pick is HINDUNILVR [stockquote]HINDUNILVR[/stockquote]. The stock has been on an uptrend through-out the year. The stock experienced its 52-week high of Rs. 580 in mid-October and then corrected itself to find support at Rs. 525. Since then the stock is undergoing a pennant formation. In the last three months, the stock has moved -6% vs. +3% of the Nifty’s.
Oscillators RSI and CMO are in no man’s land unable to give any directional suggestion. Short-term technical just saw a 9×18 bullish cross-over.
The MACD line is moving close to the signal line and the dropping histogram levels are suggesting an imminent bearish crossover for the line. The long-term and short-term GMMA lines are very constrained and hence are not suggesting any direction to the scrip.
HINDUNILVR’s average correlation with the Nifty is 0.23, which is positive. The scrip will be replicating the movement of Nifty. [stockquote]NIFTYBEES[/stockquote]
HINDUNILVR has a historical volatility in the range of 0.3 to 0.7. The scrip’s volatility currently is in the lower end of the range.
Given these technicals, we suggest a short-term and a long-term watch for the script. The investor is advised to be on a lookout for a decisive breakout of the pennant in either direction to make any directional call.
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