Momentum Pick: Will HAL shares soar to new highs post 30% rally in 9 sessions?
Hindustan Aeronautics (HAL) have rallied nearly 30% remaining unbeaten in nine trading sessions and making fresh 52-week highs on a daily basis. The stock price is expected to move up to 10% albeit with minor hiccups as the recent rally has taken the stock into a strongly overbought zone, experts say.
On Thursday, the stock fell nearly 1.5% on the intraday basis with momentum indicators RSI and MFI at 91.2 and 97.6, according to Trendlyne. It is also above its 50-day and 200-day simple moving averages (SMAs).
The stock is expected to continue its strong upward momentum in the coming days, derivatives analyst at SAMCO Securities Ashwin Ramani tells ETMarkets.
On technical charts, HAL has been moving in higher highs and higher lows since November 23, 2023, he said.
One of the highlights has been HAL's stability as the stock has traded at a 1-year beta of 0.2 despite a robust rally. HAL shares have returned over 90% in the past 12 months outperforming the Nifty, which has given over 12% returns during this time.
The price took resistance around the 2,086 levels on the daily chart twice on August 24 and September 11, gave a breakout on November 16, and later retested the same level on November 22, Ramani informed as he said that it has sharply risen since then.
The F&O counter has maximum CALL open interest at 3,000 Strike, which is likely to act as an immediate resistance while the level of 2,500 is likely to act as a support, he adds.
Ramani warns investors on the likelihood of a halt in the ongoing rally if the higher high and higher low formation is negated and the stock gives a lower closing.
Analyst Nilesh Jain also expects HAL price to further extend up to 10% over the Wednesday closing price of Rs 2,714.60 on
