Medium term view— MUNDRA PORT
Mundra Port and Special Economic Zone, part of the Adani group, is the developer and operator of Mundra Port in Gujarat. MPSEZ provides cargo handling and other value-added port services, also concentrates multi-product Special Economic Zone (SEZ).
As can be made out from the long term chart appended below, prices have been forming multiple accumulation patterns, highlighting an excellent and strong trend in progress. Prices after a short run since its listing, topped out at a life time high of 1324 during Jan 08. Unable to move past this high saw prices witness severe profit booking action and they nosedived to deep lows. The severe crash in prices brought prices to 463 in two months time. A pick up from there saw prices retrace about 62% of the prior fall and once again with the resistance taking effect, prices collapsed afresh in May 08. Since then prices were on a constant declining mode, moving all the way down to a low of 254 by the year end. Prices bottomed out from the decline and shifted into forming an accumulation phase. The fresh spurt, followed by sharp rise in May 09 saw prices move up to complete the first of the fractal accumulation patterns at 637 levels. Though prices broke out from it, overhead resistance in the form of 38.2% resistance at 660 halted the rally and pushed them into a fresh round of decline. The fall held support at the 23.6% retracement region of the same prior downswing and started forming another short term accumulation pattern on it. The fact that multiple accumulation patterns are being formed shows that the counter seems to be generating a lot of trader interest and this increases the
scope of seeing some good rally in the future. Also this accumulation on the daily time frame has been holding support around the 100-period EMA, except one time during Oct 09 it broke below it.
The news of this company being one of the 11 stocks to be introduced in the F&O segment by NSE, led prices to rocket last week and move to new swing highs of 697. This also led prices to breakout from a strong valuation resistance around 655-60. With the market taking a hit towards the end of the week, prices of this one too slipped lower but here it seems to be more of profit booking than fresh selling. The prior resistance zone of 655 is now acting as a support to prices. Even if this level was to give way and prices slip below it, it still does not damage the long term setup. Dips can be looked at as a buying opportunity here. Momentum readings are RSI has finally made a shift in range into the bullish zone above 60. With the entire setup looking great, one can consider buying this one at current or dips to 615-605 for target 780 / 910.
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Category: Medium Term
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