Technical view: Coromandel International

The stock of Coromandel is bullish today and has surged by over 2%.

After giving a breakout from its falling trendline from the level of Rs 865, the stock had hit a swing high of Rs 928.70. It witnessed a nominal correction of about 5%, but then it bounced back after nearing its 20-exponential MA support. On the technical chart, it has formed a strong bullish candle, which is identical to its previous candle in length and size. Moreover, the price action is backed by good volumes and indicates good buying interest among the market participants.

The stock has outperformed the broader market and most of its peers on a YTD basis. During this period, the stock has generated about 18% returns as against a negative 8% of Nifty 500. Moreover, it has gained about 6% in the past one month despite the overall weakness in the market.

The 14-period daily RSI (60.85) has entered the bullish territory and indicates strong strength in the stock. The On Balance Volume (OBV) also indicates an improvement in the stock’s strength. On the weekly chart, the +DMI is well above the -DMI and ADX points in northward direction, which is a bullish sign. The stock trades above all the key short term and long term moving averages and all the moving average indicate bullishness.

It has performed brilliantly in recent time despite the global sell-off in the stock markets. Good volume suggests good buying interest and it has the potential to test its prior swing high level of Rs 928.70. Considering the above points, we expect the stock to be trading higher in coming days. Traders can expect good gains in near term as per the technical analysis.

Coromandel International is engaged in the manufacture and trading of farm inputs consisting of fertilizers, crop protection, speciality nutrients and organic compost. With a market capitalization of about Rs 25800 crore, it is one of the strong growing company in its sector.