Medium Term View – ABG SHIPYARD – IDBI Capital
This shipping counter had been recommended by us as a buy at around 310 levels in our issue dated 8th Feb 2010. In that we had mentioned that as prices had been forming some accumulation patterns and showing signs of possible rally, buying can be looked at. However prices failed to show a follow thru to the breakout from 23.6% retracement (mentioned earlier) at 292 and collapsed soon after our buy call. One of the reasons for the rally attempt to fizzle out was the presence of the upper range of the ascending channel (purple line) that refused to let prices thru.
Interesting to note that the same moving avg once again came to the rescue of falling prices and after some sideways consolidation have now started showing better moves. The decline also triggered our buy on dips call at 280-75. Though prices moved much below it to lows of 236 by end of Feb, they managed to claw back up in recent sessions. The short term trend is still under pressure and is yet to show a follow thru on the upside. However as the overall long term trend continues to maintain a higher bottom formation, we hope to see a confirmed breakout from this channel move and other overhead resistances to hit our targets. We hereby revise our targets from 420 / 545 to 420 / 495. Will see for higher targets once these are met.
Source – IDBI Capital
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Category: Medium Term
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