Lupin, Divi's Lab, Aurobindo Pharma: Here's how you can trade pharma stocks

A major bullish trend may start only above the range of 8,600 - 8,500 level, that said it seems far considering the resistance of 8,400 level.

Nifty Pharma: The index is trading around 52-week low of 7900, which suggests a negative sentiment going ahead. The weekly chart in the month of August 2018 showed a trend line breakout that resisted at 200-weekly moving average (WMA) at 10,730. Thereafter, the index has been weak and profit booking has happened at regular intervals. It did try to reverse trend in March 2019 but witnessed selling pressure around 9600 levels. As index dips lower, selling pressure can intensify.

 

A major bullish trend may start only above 8,600 – 8,500 level, which seems far considering the strong resistance of 8,400. One can also see selling pressure around 8300 -8250 range, as per the daily chart. A breach of 7,900 may dent the sentiment further that can take the index towards 7,600 levels.  CLICK HERE FOR DETAILED CHART VIEW

Stocks you can buy and sell in the pharma space

 

Aurobindo Pharma (AUROPHARMA): The absence of follow-up buying has resulted in a correction of over 25 per cent in the last two months. Now, the major support of Rs 700 has become resistance for the upward reversal. Although, the RSI (Relative Strength Index) is trading around over-sold region, the stock is unable to cross significant resistance level of Rs 660 as per the daily chart. The immediate support comes at Rs 570 levels, considering the 'Death Cross' of 50 DMA with 200 DMA. CLICK HERE FOR DETAILED CHART VIEW

 

Divi's Laboratories (DIVISLAB): The stock witnessed extensive selling pressure above Rs 1750 level. The profit booking scenario may persist for some more time. That said, one can look for opportunities around current levels of Rs 1,550 considering strong support and an earlier breakout range of Rs 1,420 – 1,380. The medium-term trend remains highly optimistic with “Buy on correction” strategy for a rally above Rs 2,000 as per the technical formation on the weekly chart. CLICK HERE FOR DETAILED CHART VIEW

 

Lupin Ltd (LUPIN): The stock is trading around the crucial support of Rs 720 on closing basis. A close below this can trigger a sell-off in coming sessions. The stock slipped below the 100 DMA around Rs 885 to hit Rs 700 levels. At this juncture, Lupin needs to see some buying comfort coming in around Rs 700 – Rs 720 that can regain momentum later on. Else, the stock can see selling pressure that can take it down further towards Rs 650 - Rs 640 levels, the technical chart. CLICK HERE FOR DETAILED CHART VIEW