Chart Check: REC hits 52-week high in November, may rally another 20% in 6 months

REC, part of the financial services space, hit a fresh 52-week high in November but the rally may not be over yet as technical indicators suggest an upside till Rs 140, suggest experts.

Short-term traders who missed the rally can look at buying the stock on dips for a target of Rs 140-160 in the next 6 months, they say.

REC rose more than 30% from its June low of Rs 82. It hit a fresh 52-week high of Rs 113.70 on the BSE on 28 November 2022.

The stock also gave a pattern and trendline breakouts with a positive weekly candle (Connecting December 2021 and November 2022) to make a high of Rs 109-113 accompanied by supportive volumes.

The stock with a market capitalisation of more than Rs 29,000 crore rose more than 11% in a week and over 20% in the past 6 months.

REC is trading near overbought levels; hence, some consolidation cannot be ruled out. Short-term traders can look to buy the stock on dips towards Rs 105-100 levels.

The Relative Strength Index (RSI) is at 75.9. RSI above 70 is considered overbought. This implies that the stock may show a pullback. MACD is above its center and signal line, this is a bullish indicator.


On the price front, the stock price is trading above most of the short and long-term moving averages of 5,10,30,50,100, and 200-DMA which is a positive sign for the bulls.

“REC made a high of Rs 109.60 in August 2022, and Rs 113 in November. Recently the stock gave pattern & trendline breakouts with a positive weekly candle (Connecting December 2021 and November 2022) made a high of Rs 113 accompanied by supportive volumes,” Bharat Gala, President - Technical Research, Ventura Securities, said.

“The MACD, ADX & KST Indicator suggests a possible up move. The possible targets are Rs 140-160 in the next 6 months,” he said.

“If the stock price corrects downwards the buy levels are 105-102-100-98-96. Stop Loss to be observed in the trade is Rs 90,” recommends Gala.

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