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The stock of Eros International Media surged 5.4 per cent with good volume on Wednesday. For the week, the stock has gained 8.5 per cent. This rally has decisively breached an immediate resistance at ₹500. Investors with a short-term view can consider buying the stock at current levels. Moreover, the stock appears to have resumed its long-term uptrend that has been in place from the August 2013 low of ₹106. The corrective fall from the July 2015 high of ₹644 found support around ₹450 in late August and the stock started trending upwards thereafter. Both the daily and weekly relative strength indices are on the brink of entering the bullish zone. The daily price rate of change indicator features in the positive terrain, implying buying interest.
The short-term outlook is bullish for the stock. There’s potential for the stock to extend its rally to the price targets of ₹557 and ₹567 levels in the ensuing trading sessions. Buy the stock with a stop-loss at ₹523.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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