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Bajaj Auto Technical Analysis #75: Buy | Target Rs 2800 | Arijit Banerjee

CMP#2600.55
IdeaBUY
Buy Range2480 – 2580
Target2800 – 2900
StopLoss*2440
Duration12 – 15 Trading Sessions
Potential Return^8 – 12%
CMP#IdeaBuy RangeTargetStopLoss*DurationPotential Return^
2600.55BUY2480 – 25802800 – 2900244012 – 15 Trading Sessions8 – 12%

# CMP on Aug 02, 2019
* Maintain recommended StopLoss by daily closing basis.
   Once 1st target hit, reset StopLoss at 2700.
^ The returns are calculated based on CMP#

COMPANY OVERVIEW

Founded in 1945, Bajaj Auto Ltd is the third largest manufacturer of motorcycles and the largest manufacturer of three wheelers in the world. The company manufactures and sells motorcycles, three and four wheeler commercial vehicles and quadricycles and spare parts. Bajaj Auto’s consolidated revenue from operations increased 3.9% to Rs 7,755.82 crore from Rs 7,464.89 crore in the last quarter on a yearly basis.

Stock Data
NSE CodeBAJAJAUTO
Sectoral IndexNifty Auto
52W High3149.95
52W Low2420
Face Value10
Relative Performance_Bajaj Auto vs Nifty Auto Index

TECHNICAL OBSERVATIONS (WEEKLY)

  • Since October 2018 the stock is trying to form a base at around 2445 levels.
  • The stock made a ‘Triple Bottom’ pattern on the weekly chart and formed a ‘Bullish Hammer’ candlestick pattern with long lower shadow at the recent bottom.
  • Price has been holding above all important Moving Average parameters.
  • Volumes have gone up along with price rise.
  • Indicators like MACD and RSI turned bullish on Weekly Charts.
  • The stock formed well defined Ascending Triangle Pattern over the last 6 months and breakout above the upper side shows further bullishness.
Bajaj Auto Weekly Chart
Bajaj Auto Weekly Chart

TECHNICAL OBSERVATIONS (DAILY)

  • After a consistent down trend in the last two months, the stock price has registered a resolute breakout with sharp upside bounce in last 3 days.
  • The positive divergence of RSI on the monthly chart, which supports the breakout in the stock.
Bajaj Auto Daily Chart
Bajaj Auto Daily Chart

CONCLUSION - Bajaj Auto SHARE PRICE FORECAST

Based on our positional trading tips for indian share market, Bajaj Auto share price target will be 2800 – 2900 in the next few days.

MONEY MANAGEMENT AND TRADING RULES

1)  It’s advisable not to enter/exit beyond the recommended range.
2)  Strictly follow the StopLoss as mentioned. Honour it.
3)  Use trailing StopLoss to retain profits.
4)  Diversify trading capital into our other technical recommendations.
5)  Risk only the money what you can afford to lose. Hedge accordingly.

ANALYST SUMMARY

The research analysis is prepared by Arijit Banerjee, CMT, CFTe. He is a veteran trader and an active investor having in-depth knowledge in financial market research, advanced technical analysis, market cycle, algorithmic trading and portfolio management. Arijit is a Chartered Market Technician (CMT) accredited by CMT Association USA, the leading global authority of Technical Analysis and has been honoured by Certified Financial Technician (CFTe) from the International Federation of Technical Analysts, USA. SEBI, the regulatory body of Indian financial market also recognizes him as a Research Analyst (INH300006582).

Disclosure

The views expressed herein are based solely on information available publicly/internal data/other sources believed to be reliable, but is not necessarily all-inclusive and is not guaranteed as to accuracy. The recommendations provided herein is solely for informational purposes and are not intended to be and must not be taken alone as the basis for an investment/trading decision. Trading and investing are subject to market risk and the securities discussed and opinions expressed herein may not be suitable for all investors. To read the full disclosure, please click here.

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