Today’s pick is ABIRLANUVO [stockquote]ABIRLANUVO[/stockquote]. After an initial uptrend that lasted until April, the stock collapsed towards its long term support level of around Rs. 725, testing it multiple times through late September. However, the stock regained its mojo and has been on an up-trend ever since. In the last three months, the stock has risen 41% against 10% of the Nifty’s.
Oscillators RSI and CMO are in over-bought territory. Besides, they are at the highest levels seen over the last year which is an extremely bearish sign.
The MACD line is headed towards the signal line and the decreasing histogram levels are suggesting a short-term bearish move.
The long-term GMMA are fanning out to give a long-term bullish outlook for the stock. The short-term GMMA lines just gave a bearish signal with the lines crossing-over. However, the 9×18 technical is suggesting a near term bullish move for the scrip.
ABIRLANUVO’s average correlation of 0.62 with the Nifty is positive and strong. The stock will be replicating the movements of Nifty given such co-efficient. [stockquote]NIFTYBEES[/stockquote]
ABIRLANUVO has a historical volatility in the range of 0.3 to 0.6. The scrip’s volatility is in the middle range.
Also note that HSBC sold Rs. 15 Cr. worth (0.13% of the shares outstanding) in the open market on the 26th November.
From a fundamental point of view, Globe Capital has a BUY on ABIRLANUVO. They expect it to become a beneficiary of increased FDI in insurance and they are also bullish on its chances of getting a banking license.
To conclude, given these technicals, the stock is a short-term SELL. For the long-term the stock has a clear technical green signal and it appears that the fundamentals concur: long-term BUY.
