The pair ratio has corrected to long term crucial turning point (range).
It is also standing at 61.8% retracement of rally from Jan'18 - Feb'19
RSI is in oversold territory
Going by history, the pair ratio is ripe for reversal from 38.58 now, to potentially 44+
The pair ratio was consolidating for 3 years (Nov'16 - Oct'19) in the range of 3.899 - 5.030
It broke down in Oct'19.
161.8% retracement of the above consolidation was at 3.201. The ratio made failed attempts to breakdown below this level, only to revert back to 3.899.
The ratio has again reached (almost) the same retracement level of 3.201, with RSI making higher...
The pair chart formed bullish crab pattern with PRZ (1.618 XA) at 2.020, stop loss at (2.00 XA) 1.870.
It has confirmed bullish RSI divergence.
A failed breakdown from 2016 lows of 1.942.
As long as prices are above 1.942, the ratio looks set to revert to 2.280
Cipla faces important resistance from negative RSI divergence.
Also from falling trendline and Bearish Shark pattern (pointed out by friend Dinesh Nagpal)
Risk reward in favour of correction, as long as it is below 650, with potential support at 490