Aditya Birla Capital spurts 30% to 52-week high in April; should you buy, sell or book profits?

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Aditya Birla Capital stock hit a fresh 52-week high of Rs 208.60 on 4th April 2024. It has rallied more than 17% in a week and over 30% in a year.

The momentum helped the stock to break out from a ‘cup’ pattern on the weekly charts. The supertrend indicator also triggered a bullish signal on 1st April on daily charts.

The stock also recorded a Golden Crossover over on daily charts which suggests that the momentum is here to stay.

The Golden Crossover is a technical analysis pattern that occurs when a short-term moving average crosses above a long-term moving average.

In most cases, this involves the 50-day Simple Moving Average (SMA) placed at Rs 180, surpassing the 200-day SMA placed at Rs 178.

“AB Capital stock has given Stage-2 Cup pattern breakout on a weekly scale. Most noteworthy, the stock has witnessed the highest weekly volume since February 2021,” Sudeep Shah, Deputy Vice President, Head of Technical and Derivative Research, SBI Securities, said.

“This surge underscores a significant increase in buying interest among market participants. The stock has recently outperformed frontline indices,” he said.

“An intriguing aspect is the breakout observed on the ratio chart of the stock compared to the Nifty, suggesting a bullish sentiment,” highlighted Shah.

Additionally, momentum indicators and oscillators are aligning with the overall positive outlook, adding further confirmation to the bullish trajectory of the stock.

What should investors/traders do?

Aditya Birla Capital stock has been in a rising trend after hitting a low in December 2023. The stock recently reclaimed its 50-week moving average on the weekly charts which suggest momentum.

“Despite the stock gaining 20% in the past 3 months and 30% in the last 1 year, due to the strength in the current break-out, we feel a fresh upmove could be witnessed from the current levels,” highlighted Shah.

“The stock is likely to continue its northward journey in the next couple of months. As per the measure rule of Stage-2 Cup pattern, the upside target is placed at Rs 250, followed by Rs 270 in the short-term,” he recommended.

“On the downside, the zone of Rs 170-175 is likely to provide a cushion in case of any immediate decline,” added Shah.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)