Stock of the Day – Cummins India

The whole Capital Goods sector has been on a steady rise in recent times. A few days ago, I covered Crompton Greaves & Siemens out here and today its Cummins India which has broken above a multi year resistance and today made a all time high before declining a bit from the intra-day highs. 

The move from mid 2011 can also be seen as a move within a Ascending Triangle pattern which helps us in getting a target price (since with the stock being at the all time high, no prior resistances can be found). Based on the pattern, the target in the short to medium term can be found at 730.

Most stocks that breakout do tend to re-test the breakout levels though once in a while one does see a run-away rally. The volumes so far seem to suggest that a re-test may happen though  end of the day, market knows best 🙂

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About Prashanth

Have been a full time participant in the stock markets since 1996. Run a Yahoo Group where focus is exclusively on discussions of the Indian Markets using Technical Analysis as the tool (groups.yahoo.com/group/technical-investor)
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