Idea registered new all time high in the last 2 weeks but failed to close near it. The stock has seen a fantastic rally in the fashion of what is technically called as a parabolic curve (refer chart) from 70 to 170 in the last 12 months.
The approval of 100% FDI approval was a big boost propelling telecom stocks lately but is surely priced in now. There are visible signs of exhaustion in price & looks like we have a short term top in place. So we would be cautious on the stock at current levels and would rather wait for some consolidation/ pullbacks to provide a better risk reward on the long side. There is a confluence of support levels available between 140-148 and investors with a medium to long term horizon can wait for a successful retest of this zone to time their entries.
Looking at the long term technicals, Idea has recently made all time highs and the intermediate to larger trend is intact. We have a projected target of 195-200 and investors can look forward to accumulating it on dips. A fall below 124 would be a sign of worry for the long term trend in the stock.
This analysis was also featured online at Economic Times (read here)