Suggestion: Buy, Target Rs. 400
Last Price 374.50
The stock price of Wipro is currently as shown in Fig. 1. This particular figure also shows 3 major SMAs, for which the colour coding is given below
Orange – SMA(4)
Brown – SMA(9)
Red – SMA(18)
Note: SMA(n) means a Simple Moving Average of n days.
As the SMA(4) is above the other SMAs, it clearly indicates that the Bulls are in action and thus this is the season to buy the stock. However, the rate at which SMA(9) is rising, it is possible that the season may come to an end soon.
The current ADX value is 60.02 as clearly shown in Fig. 2. This indicates that the stock is currently in the trending phase. This further confirms that the trend (shown in Fig. 1) is present and is not a whipsaw.
The above figure (fig. 3) shows the Bollinger band above the price levels with a base line of SMA(20). As can be seen, the prices are majorly moving near the upper band (above the base line). This is an indication of Bullish phase. But the strength of the current bullish phase is still not known, which is identified using the indicator shown below.
MACD Histogram, as shown in fig 4, helps in identifying the strength of the current trend. The current trend is identified as Bullish with the help of above-used indicators. Above figure shows that the current Bullish trend is losing its strength and thus might come to an end in the coming sessions. The only benefit that is left is to make use of the available time and generate profits.
With the help of above-used indicatos it is identified that the Bulls are leading the stock, however their strength is decreasing and thus Bullish phase might come to an end soon. Therefore, it is advised to the investors to buy the stock at the current price with a target price of Rs. 400.