Short-to-medium-term traders can look to buy the stock now for a possible target of more than 500 in the next 3-4 weeks, suggest experts.
Part of Tata Group, Indian Hotels stock hit a fresh record high of 488 on 23rd January 2024. A mild profit booking was seen which was in line with the broader market trend, but dips if any can be used as a buying opportunity.
The hotel stock rose from Rs 424 as on December 20, 2023, to Rs 479 as on 20th January 2024 which translates into an upside of nearly 13% in a month.
The stock is trading in an upside channel on the weekly charts from 2020-21 which is a positive sign. The stock picked up momentum after forming a short-term base above 370 levels back in October 2023.
In terms of price action, the stock is trading below the 5-DMA but above 10,20,30,50,100, and 200-DMA on the daily charts.
The daily Relative Strength Index (RSI) is at 65.7. RSI below 30 is oversold and above 70 is considered overbought, Trendlyne data showed.
“Indian Hotel stock is currently demonstrating robust momentum, hovering near its all-time high. The stock is following an upward trajectory within a rising channel since 2020, and a noteworthy observation is the change of polarity formed within this channel, indicating a clear and steady upward path,” Vidnyan S. Sawant, Head of Research at GEPL Capital, said.
“Particularly interesting is the stock’s historical pattern where, upon pulling back from the polarity range, it witnessed an average rally of approximately 60%,” he said.
“With the current uptick standing at 30%, it suggests there is still considerable room for further upside potential,” highlights Sawant.
On the weekly scale, the Average Directional Index (ADX) is recorded at 26, signaling the establishment of a strong trend. This structural development enhances the overall positive outlook for Indian Hotels.
“Looking ahead, we anticipate further upward movement in prices, targeting the 554 level. It is recommended to set a stop-loss at 452 based on closing values,” recommended Sawant.
(You can now subscribe to our ETMarkets WhatsApp channel)
(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)