Chart Check: Contra buy? This agri product company is down 30% from October 2021 highs

Advanced Enzyme Technologies, which is down over 30 per cent from its 52-week high is showing signs of a rebound.

The stock with a market capitalisation of more than Rs 3000 crore is firmly in the bear grip. It managed to rally nearly 10 per cent on 20 September to close at Rs 293. It rose over 6 per cent in a week.

Advanced Enzymes is a research-driven company with global leadership in the manufacturing of enzymes and probiotics. It has state-of-the-art manufacturing facilities and research & development centres across India, the US, and Europe.

The stock hit a 52-week high of Rs 421 on 11 October 2021 but failed to hold on to the momentum. The stock closed at Rs 293 which translates into a downside of over 30 per cent.

The stock took support above Rs 250 in February 2022 and then bounced back but it found resistance closer to Rs 300-320 levels. The stock consolidated in a range and again retested Rs 250 levels in July before bouncing back.

The stock did manage to break above Rs 300 level in intraday trade on 20th September 2022 and also above a falling trendline since February 2022.

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The Relative Strength Index (RSI) is at 41.1. RSI below 30 is considered oversold and above 70 is considered overbought. MACD is below its Center Line, which is a bearish indicator.

“The stock has corrected from the level of Rs 503 to consolidate at around Rs 250 levels and with the positive candle pattern formed, the stock looks potentially poised for an upside bounce,” Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher Pvt. Ltd, said.

“The RSI indicator is positive; we recommend a buy on this stock for an upside target of Rs 380 in the next 3-4 weeks, and keeping a stop loss of Rs 280,” she added.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)