Today’s pick is SUZLON [stockquote]SUZLON[/stockquote]. The stock started the year with a series of tops at Rs 30 levels, and then the stock slowly moved down to find support around Rs. 15. After hovering around the same levels for three months it started its current up-move in Late November. In the last three months, the stock has moved +60% vs. +5% of the Nifty’s.
Oscillator RSI and CMO are close to the over-bought territory. The stock is trading in the upper end of Bollinger band giving a downward bias.
The MACD line is closing in towards the signal line in a bearish manner and is being confirmed by the dropping histogram levels. However, Long-term GMMA lines are quite distant from each other and are giving out a bullish signal for long-term.
SUZLON’s average correlation with the Nifty is 0.57 which is positive and strong. The scrip will be replicating movement of Nifty closely. [stockquote]NIFTYBEES[/stockquote]
SUZLON has a historical volatility in the range of 0.4 to 1.2. The scrip’s volatility is currently in the upper end of the range.
Given these technicals, we suggest a short-term sell. For the long-term, the GMMA lines, and strong up-trend are suggesting a BUY. However trailing stop-losses will be of help in case sudden trend-reversal were to take place.
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