Larsen
& Toubro (L&T)
is a technology, engineering, construction and manufacturing company. It is one
of the largest and most respected companies in India's private sector. This firm is likely to show better price
performance in near term supported by good fundamentals and technical breakout.
On chart, stock prices are volatile.
The stock hit 52-weeks’ high of Rs. 1615 in July 2016, then price revered low of
Rs. 1295.10, in the month of November 2016, down by 19.80 percent from its
52-weeks’ high. Currently, stock price is trading at Rs. 1375.20. The stock
price witnessed 6.22 percent rise in last month from the initial low. We feel
that there is more room left on upside and the rally is likely to continue.
On chart, we witnessed stock price
was trading below 20 DMA from last 28 trading sessions but yesterday price has
breached the 20 DMA and closed above the same, indicate stock price has find
the support level. If today once again price respect the 20 DMA, then most
likely it will move towards previous high swing
Technically on a different time scale of daily & weekly chart stock
price is making higher tops and higher bottoms pattern. Tracking Bollinger Band
front price of. Rs. 1375.20 trading above the mid-band of BB, which will take
stock price towards ‘Upper Bollinger Band’ and the bands are widening, indicate
ongoing positivity will continue in the stock price.
On a daily chart stock
price at Rs. 1375.20 has given the breakout above the upper trend line of symmetrical
triangle or continuation pattern at Rs.1369, with sharp increase in volumes,
indicate rally will continue for the multi month towards Rs. 1520 level.
The positive crossover
spotted in moving average convergence divergence or MACD (a momentum and trend
indicator) also suggest the formation of the next big move up in the stock over
the next few months. RSI, which indicates inherent strength, it has more room
upside, which adds further positivity to the index. Most of the oscillator based indicators also
point towards the bullish view of the stock price.
Looking towards the chart
pattern and study i.e. Bollinger Band, RSI and MACD, we believe stock price may
extend its rally towards Rs. 1520 levels, whereas Rs.1304 will act as a strong
support level, which would be on closing basis.
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