Delta Corp surges over 5%! Is it the right time to buy?

The stock of Delta Corp is one of the top gainers in the Nifty 500 universe.

Shares of Delta Corp surged over 5% during the initial hours of Tuesday’s trading session. The stock is in a strong downtrend, having plunged about 47% from its 52-week high level of Rs 339. Today’s positive price action has certainly cheered the shareholders. Above-average volume was recorded today, which indicates strong buying interest at lower levels.

The technical indicators are currently in the bearish zone but have seen an improvement on Tuesday. The 14-period daily RSI (29.55) lies in the bearish territory but has seen a jump from its oversold counters. The On Balance Volume has also seen a good improvement. Despite this, the stock is still down by about 10% from its 20-DMA and about 25% from its 200-DMA. Also, the Relative Strength (RS) is in negative territory and suggests underperformance of the stock as against the broader market.

Technically, the stock is still bearish. However, Tuesday’s price action can be an early sign of reversal. The stock needs to sustain above the 20-DMA level of Rs 210 and should register above-average volume for some good buying opportunities. A rise above Rs 210 level can see the stock test the levels of Rs 240 in the medium term. Failing to do so mean will mean that the trend will continue to remain bearish, and stock can test the level of Rs 165. Traders can include this stock in their watchlist to track further development.

Delta Corp Limited is primarily engaged in the operation of casinos in Goa. Its segments also include Real Estate, Gaming, and Hospitality. It is a midcap company with a market capitalization of over Rs 5000 crore. The company, during its recent quarterly results, said that it has posted robust numbers despite the closure of operations due to the pandemic.