For the past several weeks, SUNPHARMA has been lodged inside a downward channel while NIFTY has tested new highs. Now within this channel it seems to have formed a highly bearish Head & Shoulders pattern whose height is measured at a mind boggling 245 points! I wonder what does the market know that we poor slobs are unaware of! Worth watching this stock's chart for education.
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Below 372 but Volume needs to catch up.
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As this hourly chart shows, any rise to 385 levels should be used to short it as the price is dipping below 372 although breakdown volume is not seen yet.
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The tussle between bulls & bears is on. The stock has turned quite volatile. Volumes are rising. Today is weekly expiry so this is expected. No entry in the stock at present.
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It's 10:50am and our stock has touched 384.50. High risk traders can enter shorts with a strict stop loss.
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11:45am After going below 380 it sprung back up to eat stop losses, touched 386.85. Rest of the day is going to be crucial whether bulls can maintain their lead. I doubt it.
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12:28am Touched 388.60. Bulls have turned vicious taking bears to the cleaners.
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On the back of FED's comment that they MAY consider cutting rates, global markets rallied, and so did Sunpharma to touch 392 level yesterday. But Daily volume was still average. On a weekly basis our analysis above still stands unless it breaks above 436-38 levels. It must be noted that brokerage houses like ICICIBANK, Sharekhan have a HOLD call with 460 as target (which is still well below the right shoulder top of 484 in H&S pattern.)
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Recent bullish push to 410 level notwithstanding, once again Sunpharma is dipping below 372 levels and easily breached recent low of 368. I still feel it's got downward bearish potential that remains untapped.
technically there is a mac-d divergence showing up
but only if the daily closing is above 395 , we can think of buying this stock
punterpk
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@MAYA_MUMBAI, Thanks for your input. I am not looking at fundamentals as a tech analyst. One hears stories about shares being pledged and all that but what ultimately counts is price, volume and time on the charts. And there is no denying that this share has been losing value continuously over a significant time period. Every so often it breaks lower levels. That makes a solid case of shorting on rises imho. But it is fascinating watching its movements. Thanks again.
i guess bulls will be active only on a daily close above 395, but todays green candle is looking strong
punterpk
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@MAYA_MUMBAI, Well. I think the bulls are already out to prove a point and save the stock from the disaster of a precipice it was staring at. The whole pharma sector is witnessing an uplift. Must be some news. But it is still not out of the woods I think. Let's see. Better to just watch it :)
fundamentally it is in fair value
technically there is a mac-d divergence showing up
but only if the daily closing is above 395 , we can think of buying this stock