Should You Hold or Book Profit in Thermax?

Thermax Ltd Remarkable Performance

The stock of Thermax Ltd has become the talking point on D-Street as it has not only crossed the milestone of the Rs 4,000 mark but also touched a fresh record high of Rs 4,115, with the market cap inching closer to the Rs 50,000 mark. The stock has had a very good outing in CY2024 so far, jumping more than 33% on a year-to-date basis and delivering handsome returns of nearly 84% in the last year. After such a breathtaking move, the commonly asked question is whether one should take profits off the table or continue their long positions. Let’s examine this from a technical perspective.

Technical Analysis- Ascending Base Pattern

Technically, the stock is in a clear uptrend, trading above its short- and long-term moving averages and near lifetime high levels. Importantly, the moving averages are in a desired sequence and trending upwards, which is positive for the stock. On the daily timeframe, the stock has witnessed a breakout of the “ascending base” pattern.

O’Neil Methodology Perspective

From an O’Neil methodology perspective, the stock has an EPS Rank of 88, indicating consistency in earnings, and an RS rating of 75, which is fair, having made a fresh high indicating strong recent price performance; buyer demand stands at B+.

Technical Indicators

The daily MACD is pointing northward while sustaining above its nine-period average, validating a positive bias in the stock. The daily RSI has recently generated a bullish crossover and is on a rising trajectory, further validating a positive bias. The trend strength indicator, Average Directional Index (ADX), is at 31.32, showing strength, and in an uptrending mode. The +DI is significantly above the -DI and ADX, indicating bullish strength in the stock.

Hence, keep this stock on your radar.

Disclaimer: This post has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.