The clouds of weakness has been faded away after the index has closed above the the psychological resistance of 12,000 levels and a lackluster performance was expected by the index after firecrackers. Nifty50 had a marginal negative opening today and consistently trading in a narrow range of 12,024.75-12,095.20 levels. The street is waiting for the RBI’s MPC decision and expecting a rate cut as the GDP numbers reported last week were not lucrative. In today’s session, the index is not expected to cross 12,100 today as major Call writing is seen at these levels. On indices upfront, pharmaceutical stocks lost the most, currently trading at 8,436.45, 1.17% below from its previous close. On daily scale, the index is forming an ‘Inverted Flag’ pattern, which is a trend following pattern whose reliability is very high. The index is expected to witness more downside once it will trade below 8,250 levels. The counter is trading below 30 days Exponential Moving Average. MACD is hinting for more downside while RSI is trading at 33.5 levels. Although MACD and RSI are not the only indicators to dictate the future prices, one can make use of other tools like Fibonacci, Andrew Pitchfork, Chart and Harmonic Patterns.
Some stocks of this counter are also witnessing heavy volumes and momentum that are convincing the emerging trend.
- Dr Reddy’s Lab: Top loser in pharma sector is trading at 2,644.85, 2.79% below from its previous close. The stock is trading below 150 days Exponential Moving Average. There has been a block deal of 138,769 shares on May 21, 2019.
- Divi’s Lab: Leading midcap pharma stock has erased 1.61% in today’s session. There has been a block deal of 33,165 shares on May 27, 2019. The stock is trading above 100 days Exponential Moving Average.
- Glenmark Pharma: Highly leveraged pharma stock is trading at 540.5, 1.11% below from its previous close. The company has reported an increase of 6.62% net profits in Q4 results. The company has received USFDA nod for overactive bladder treatment drug on May 21, 2019.