sterling tools share price: Chart Check : After nearly doubling in 3 months, this smallcap stock is on buyers’ radar

The stock with a market capitalisation of about Rs 1,000 crore has been witnessing strong price action in the last week as well as on a one-month basis.

managed to surpass crucial resistance levels placed around Rs 250 in June 2022 to hit a fresh 52-week high of Rs 297 on 28 June 2022.



Although shares of Sterling Tools came under some selling pressure, experts feel that the upside is still intact which could take it towards Rs 400-500 in the next 6 months, suggest experts.

Positional traders can look to invest in the stock now or on dips towards Rs 227-205-188-170-160 levels. On the price action front, the stock is trading well above crucial short- and long-term moving averages of 5,10,20,30,50,100 and 200-DMA.

The stock bounced back after making a bottom above Rs 100 back in May 2022. The strong price action resulted in the formation of a ‘Golden Cross’ on daily charts on 27 June 2022.

A Golden Cross forms on a chart when a stock or an index’s 50-day short-term moving average crosses above its 200-day moving average.

The stock price started its up move from Rs 18 (May 2013) to Rs 478 (Dec 2017), making a series of Higher Tops and Higher Bottoms, supported by volumes which is a positive sign for the bulls.

“During the move, the stock continuously traded above averages and the stock always bounced taking support of the averages and continued its uptrend supported by volumes,” Bharat Gala, President – Technical Research,

Securities, said.

“Profit booking followed, and the stock traded below averages making a low of Rs 105 in May 2020. Two attempts followed to crossover Rs 255 area but failed,” he added.

Currently, the stock made three positive monthly price candles and crossed the previous resistance of Rs 256, making a high of Rs 261 — showing buying interest in the stock.

“The KST, Demand Index and PVT Indicators indicate buying strength in the stock. The possible targets are Rs 400-500 in the next 6 months. If the stock price corrects downwards the buy levels are (Rs 227-205)-Rs 188-(Rs 170-160). Stop Loss to be observed in the trade is Rs 155,” recommends Gala.

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