Here's why Mehul Kothari recommends buying Elecon, Hindustan Petroleum

According to the technical analyst from Anand Rathi, Elecon has confirmed a range breakout while HPCL seems to be testing support at its long-term trend line.

BUY

ELECON

TARGET: Rs 255

STOP LOSS: Rs 210

In the last trading session; ELECON confirmed a range breakout above Rs 219 mark at its new 52–week high. The price action was supported with humongous volume which indicates that the breakout could be genuine.

The breakout resembles an inverse head and shoulder pattern which suggests much for upside in the coming week. Thus, traders can accumulate the stock on dips in the range of Rs 230 - Rs 222 with a stop loss of Rs 210 for an upside target of Rs 255 in the coming 2–3 weeks.

BUY

HINDPETRO (HPCL)

TARGET: Rs 246

STOP LOSS: Rs 220

After the recent fall, HINDPETRO found support near Rs 220 mark which is the placement of long term rising trend line. The rising trend line support coincides with the placement of Span B of Ichimoku indicator and that too a flat one. 

This could be a major support on the downside and we might witness some bounce from the current levels. Thus we advise traders to go long in the stock in the range of Rs 232 - Rs 228 with a stop loss of Rs 210 for an upside target of Rs 246 in 2–3 weeks.

(Mehul Kothari - AVP – Technical Research, Anand Rathi Shares & Stock Brokers. Views are personal).