Wednesday, July 13, 2016

Beginning of a new bull run in Mahindra & Mahindra

This Auto major is one of the most versatile players in the sector. They have presence in all the categories from agriculture to luxury cars to two wheelers.

Mahindra and Mahindra is cruising with the new initiatives in terms of product category, which is making them a strong player lesser prone to sector fluctuation as compared to other players.

On Technical charts there is a classic formation. You can see from the chart enclosed here that the stock has been trading in a broad range since Sep 2014 till June 2016. This range was between 1140 to 1410. In June 2016 stock closed beyond this range at a price of 1429. This suggests a range break out on monthly chart.

Before the period consolidation (trading range of Sep 2014-June 2016) the chart had given a nice run up of 776 to 1407 in a period from Sep 13 till Aug 14. That run up has given more than 80% returns to investors. The run up had come after a break in range just before this run up.

Similar pattern seem to have been emerging on the chart. This is good for medium term investors who are looking to invest for a period of 6 months to a couple of years.

Currently stock is trading near 1475. On daily chart there is a support near 1400. The prices can correct upto that level which will be an accumulation opportunity to investors.

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Disclaimer: The contents produced here are purely for educational purpose. They should not be construed as buy/sell recommendations. I am not a SEBI registered Analyst or Investment Advisor. Readers are advised to consult their Investment advisor before taking any decisions based on above write-up.