With the horizontal trendline broken, HAL is set to move upwards towards Rs 3,010

Hindustan Aeronautics Limited’s (HAL) technical indicators point to an upper-side breakthrough on the daily scale, which is supported by a surge in volume. Head of Technical and Derivative Research at SBI Securities Sudeep Shah predicts that the stock will soon rise to Rs 3,010 and then to Rs 3,070.

HAL was up 37.35 points, or 1.3 percent, from the previous closing when it was trading at Rs 2,907.35 on the National Stock Exchange at 10:55 a.m. on January 4.

On December 18, HAL soared at Rs 2,850, and then had a slight drop. The volume activity stayed below average throughout this retreat phase, according to Shah, indicating a typical dip after a notable upward rally.

“Notably, the correction found support around the 20-day exponential moving average (EMA) level, aligning with the 23.6 percent Fibonacci retracement level calculated from its earlier upward surge (Rs 1,768-2,850),” he stated.

On January 3, the stock produced a horizontal trendline breakout on the daily scale, strengthening its base formation close to the support zone. A volume increase, he claimed, reinforced the breakthrough.

Every moving averages-based setup points to a bullish momentum. Relative strength indexes (RSIs), both weekly and daily, are quite positive. Additionally, the daily stochastic has shown a bullish crossover.

Shah stated, “The January series future has surged by 2.79 percent on the derivatives front.” The current, next, and far series’ cumulative open interest (OI) has increased by almost 7%, suggesting a general protracted build-up.

According to him, there is a notable concentration of open interest in calls at the 2,900 and 3,000 strikes, respectively, and a notable concentration of open interest in puts at the 2,860 strike.

A considerable build-up of long positions has been observed in the 2,900 Call strike. On the other hand, 2,920 to 2,780 strikes on the put side have either experienced put writing or put long covering. This demonstrates the stock’s clear bullish momentum.

With a stop loss at Rs 2,780, Shah suggests accumulating the stock in the Rs 2,880-2,850 range, given the favorable alignment of technical and derivative indications. Short-term forecasts show an upward trend, with initial goals of Rs 3,010 and subsequently Rs 3,070.