Breakout soon candidate: Keep this tyre stock on your radar

Breakout soon candidate: Keep this tyre stock on your radar

by 5paisa Research Team Last Updated: Dec 13, 2022 - 12:35 pm 22.5k Views
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Shares of Balkrishna Industries gained over 1.5% on Tuesday.

Balkrishna Industries Limited is engaged in manufacturing a range of off-highway tires. These tires are mainly meant for agricultural, industrial and construction, earthmover and port, mining and all-terrain vehicles (ATV).

The stock of Balkrishna Industries gained over 1.5% on Tuesday. It is on the verge of a breakout of nine-month consolidation which has taken a shape of a triangular pattern, signalling the resumption of up move and offering fresh entry opportunities. The stock has jumped over 13.5% from its recent swing low which was registered in June.

Technically, the stock is trading above its key important moving average like 20, 50, 100 and 200-DMA. The daily 14-period RSI is trading in the bullish territory after forming a base at the nine-period moving average thus supporting the positive bias. Furthermore, the daily MACD is pointing northward while sustaining above its nine-period average which further reaffirms positive bias in the stock. Also, the MACD histogram shows bullish momentum is picking up.

The Elder Impulse System has formed a series of bullish bars and the stock is trading above the Anchored VWAP, anchored from the all-time high level. The +DMI is above -DMI and ADX. Improved strength in ADX is also a positive sign for the stock.

Going forward, keep a close eye on the level of Rs 2330 as a close above this level would result in a breakout of triangular pattern and the stock can see a quick move towards levels of Rs 2460-2540 in the medium term. Meanwhile, on the downside, the level of Rs 2200 is likely to act as immediate support for the stock and a close below the level of Rs 2200 would negate the bullish view on the stock.

The stock has gained more than 3.5% in the last week and in the last one month it is up by over 6%.

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