Bajaj Auto - Breaking Away

Bajaj Auto has closed today at 2916. There are some reasons to start taking an active look at this stock.

• On a fibonacci chart, the stock has retraced 61.8% of its previous levels. It has broken this level for the first time after reaching close to it 4 times in the past 4 months. The breakout today has occured on strong volumes. An indication of some strength in the stock
• The volume chart from OBV has been on an upside.
• However, for the stock to move from this level would be difficult as the RSI indicator is in the mid 60s. So there is a strong possibility of the stock to correct back to probably 2860 before an upside target of 2995 and the next level at 3250.
  

However, the movement today is something that I have been waiting to see from this stock. I would wait for another couple of days unless there is some strong buying happening in this segment. Again, given the indices in most countries correcting and Indian P/E becoming extremely expensive, I think there is sometime for the stock to reach higher levels.