Technical Check: Signs of bottoming out suggest Voltas on track to hit fresh 52-week high

Voltas Ltd rose over 44 per cent so far in the year 2021 compared to about 30 per cent rise seen in the Nifty50, while on a one-year basis, the stock has rallied by over 70 per cent.

Voltas, with a market capitalization of Rs 39,000 crore, hits a fresh 52-week high of Rs 1356 on 19 October but since then it underwent some consolidation. The stock dipped more than 8 per cent last week.

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Voltas Limited is a six-decade-old company in India with expertise in Air Conditioning and Cooling technology. The company is broadly structured into projects and products businesses.

The stock took support on its 50-Days Moving Average and bounced back. The stock is showing a sign of bottoming out, and there are higher chances of a trend reversal from here on.

If the momentum continues, the next target on the upside is placed at 1350-1380, which translates into an upside of 16 per cent from Rs 1189 recorded on October 25 in the next 2-3 months, suggest experts.

Recently, from August-end, the stock has given a decent rise from the significant 200-DMA level of 955 to attain the peak level of 1356 yielding good returns for the investors.

The current correction saw the stock to witness profit booking and slipped to near 1145 levels to retrace exact 50% of the swing witnessed recently.

“The stock has shown a sign of bottoming out near 1150 levels and just moved above the significant 50EMA level of 1185 to improve the bias and indicate strength to anticipate for further rise in the coming days,” Vaishali Parekh, Vice President - Technical Research at Prabhudas Lilladher Pvt. Ltd, said.

“The RSI has also flattened out near the oversold zone and indicating a trend reversal to signal a buy from here on,” she said.

With the chart looking attractive, Parekh suggests investors to buy the stock for an upside target of 1350-1380, keeping the stop loss near 1120 levels for a time frame of 2-3 months and yield decent returns from the investment.

(Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)