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Our analysts pore over technical charts to offer some smart trading tips for the short term

Author: Srinivas Krishnan Bobba/Thursday, October 1, 2020/Categories: Exclusive

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Our analysts pore over technical charts to offer some smart trading tips for the short term

Grasim Industries Ltd (NSE: GRASIM) is an Indian manufacturing company based in Mumbai, Maharashtra. Grasim Industries was ranked 154th in a list of the world’s best-regarded firms compiled by Forbes. It was started in 1947 as a textile manufacturer. Since then Grasim has diversified into Viscose Staple Fiber (VSF), cement, sponge iron, chemicals, and diversified financial services (NBFC, asset management, and life insurance). The company is a subsidiary of Aditya Birla Group. Grasim is the world’s largest producer of viscose rayon fiber with about 24 per cent market share. Textile and related products contribute to 15 per cent of the group turnover. Grasim Industries operates Private Harihar Airport In Harihar, Karnataka. The airport serves as an airstrip for private charter service.

On the technical front, GRASIM has higher highs and higher lows on the daily charts and is currently placed above the significant long-term EMAs. In the recent past, after clocking the high of 750 level, the stock has witnessed correction towards 675 level. The stock had previously formed a base of around Rs634-640 levels on the daily charts. At the current juncture, the stock has a support zone around Rs650-660 level on the lower side and is all set to move higher. The overall chart structure of the counter looks bullish with a technical breakout at the Rs653 level forming higher highs and higher lows.  This may trigger a fresh round of buying which may take the stock towards Rs780 plus levels. The stock is currently performing in line with the broader markets indicating the inherent strength in the counter and is trading well above the long-term support levels. On the Bollinger band (20,2), the stock price is plotting above the upper band indicating the price likely to trend higher. Analyzing the recent volume price action, the volumes have been encouraging in the recent up move indicating strong hands have started accumulating the stock at current levels. On the oscillator’s side, RSI (14) is trading in the bullish zone of above 50 levels indicating the intact bullishness in the stock. We expect the counter to continue its bullish performance in the future as well and may move towards Rs800 level in the medium term. Any correction towards the recent support levels of Rs650-660 levels may be utilized to average the positions.

Srinivas Krishnan Bobba, Deputy Manager (technical research analysis) Karvy Stockbroking Ltd

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The technical studies / analysis discussed here can be at odds with our fundamental views / analysis. The information and views presented in this report are prepared by Karvy Consultants Limited. The information contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and we are not responsible for any loss incurred based upon it. The investments discussed or recommended in this report may not be suitable for all investors. Investors must make their own investment decisions based on their specific investment objectives and financial position and using such independent advice, as they believe necessary. While acting upon any information or analysis mentioned in this report, investors may please note that neither Karvy nor Karvy Consultants nor any person connected with any associate companies of Karvy accepts any liability arising from the use of this information and views mentioned in this document. The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above mentioned companies from time to time. Every employee of Karvy and its associate companies is required to disclose his/her individual stock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis and investment recommendations are restricted in purchasing/selling of shares or other securities till such a time this recommendation has either been displayed or has been forwarded to clients of Karvy. All employees are further restricted to place orders only through Karvy Consultants Ltd. This report is intended for a restricted audience and we are not soliciting any action based on it. Neither the information nor any opinion expressed herein constitutes an offer or an invitation to make an offer, to buy or sell any securities, or any options, futures or other derivatives related to such securities.

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