L&T poised to move towards Rs 3,800 after trendline breakout

The Larsen and Toubro (L&T) stock is exhibiting a breakout on the monthly chart, forming higher tops and higher bottoms. Analysts expect the stock to move to Rs 3,800 in the next month and to Rs 4,000 over the next few months.

At of 12.53 pm, L&T was trading at Rs 3,509 on the National Stock Exchange, up or 0.5 percent from the previous close.

Traders view

Larsen and Toubro: Buy | LTP: Rs 3,500  | Stop-Loss: Rs 3,450 | Target: Rs 3,600 | Time frame: One month

On the derivatives front, Rajesh Sriwastava, a derivatives trader, states, “L&T shows 1,600 plus lots of call unwinding, typically signalling a large price move ahead.”

Jyoti Budhia, a derivatives trader, said, “The Larsen and Toubro stock price is still maintaining its all-time high levels, and the RSI in all higher time frames is sustaining above 70.”

She recommends accumulating the stock around the Rs 3,500, anticipating the scrip to reach the target of Rs 3,600 within a month, with a stop loss set at Rs 3,450.

L&T technical chart showing breakout and stock trading above RSI levels | Source: Jyoti Budhia

Technical Analyst Views

Larsen and Toubro: Buy | LTP: Rs 3,500 | Stop-Loss: Rs 3,350 | Target: Rs 3,800 | Time frame: One month

According to Rupak De, Senior Technical Analyst at LKP Securities, “L&T has been moving up with a higher top and higher bottom formation on the weekly chart, suggesting an ongoing positive trend.”

The current uptrend was likely prevail in the short term unless there was a breakdown from the current formation. Over the short term, the stock was expected to move towards 3,800, with support visible at 3,350, he added.

Avdhut Bagkar, Derivatives and Technical Analyst at StoxBox, said the bull run in the stock continued to see higher interest from market participants. “The stock has successfully absorbed all the selling pressure emerging around the 3,400 levels, foreseeing a breakout that could rally in the direction of the 4,000 level, he said.

The support of the 50-simple moving average (SMA) at 3,116 may be considered for a medium-term outlook. Immediate support was at the 3,320 level. “The broader outlook portrays ‘Higher High, Higher Low,’ which should see greater interest in the forthcoming sessions,” he said.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.

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