DIVISLAB trade ideas
DivisLab, 200 DMAAmong the Pharma majors, DivisLab has been the foremost one to show the change in trend since price crossed 200 DMA and 50 Crossed 200 DMA (Golden Cross). After a jerky rise, price has started correcting due to Negative Divergence. Now the stock is taking support at 200 DMA (1035). But technical support lies at 1011 maximum where bulls are selling PUTs. So this range of 1035 to 1015 is to be watched closely If price comes down towards 1011, a Positive Divergence will be developed which may charge the bullish sentiment again.
DivisLab, E-Waves, ConsolidationAscendance of US President Trump to throne numbed the Indian Pharma industry (and also IT sector). For last 4-5 years US FDA's (US is one of the most lucrative markets for Indian Pharma) onsite scrutiny and warnings are making it difficult for this manufacturing sector to work. Stocks of big companies nosedived (for example: Wockhardt, Lupin, Auropharma, SunPharma etc.). However in recent months things have been changing for the better and some Pharma majors are showing signs of recovery. Divis is one such stock. Price created a bottom and took support therefrom. Five waves up are done and now consolidation is going on and well-defined resistance level is being hit clearing of which will give a breakout taking the price to new height.
clear bullish breakout on the monthly chartif the price retraces to 852 go long for the target of 1178
DIVISLAB buyDIVISLAB has been in a long downtrend followed by a lengthy consolidation.
It has just broken above the range and looks good for follow through.
The logical first target is 710 and eventually, if the rally sustains, it should fill the gap at 760
INTRADAY DIVISLAB SHORTDIVISLAB IS SHORT BELOW 623 WITH A STOP LOSS AT AROUND THE HIGH OF THE CANDLE WHICH BREAKS THE IMPORTANT SUPPORT LEVEL.
TARGET CAN BE AROUND 620-618.
ALL THREE CONDITIONS WHICH I SEE ARE IN PLAY.
VOLUME IS HIGH
RSI BELOW 30
PRICE IS NEAR SUPPORT LEVELS AND IN DOWN TREND.
Divis Laboratories ( DIVISLAB ) - Damaged And DeflatedDivis Laboratories' stock has been technically damaged by sudden burst of bubble. Only hunky-dory sector in Indian stock market which can stand on its foot is pharma after much publicized IT sector. Pharmaceutical companies stocks are like runaway trains, exhibiting near vertical rise on the charts. There is no way that this can continue forever. We did mention our simple pharma playbook in previous trade idea for Auropharma. In that post we have clearly mentioned that never chase the rally in pharma and just wait for some catalyst to shoot it down e.g. Ubiquitous FDA warnings.
An abate rise from 500 to almost 1400, tripling the stock in just 3 years - 2014 - 2016 end, has been undone by just couple of weeks! Nothing new in this story and such events happen many times in stock market. Lesson is simple that those who lost discipline and chased the stock are going to burn and those who have waited are going to be rewarded. Patience is hard to develop virtue ;)
DIVISLAB will become interesting below 700. Any spike lows below that near the 500 region +/- 100, will bring in ample buyers. And yes, you guessed that right that we will be buying from those levels too :)
Our other big pharma plays of the year are, ( Please check the links )
GLAXO,
DRREDDY,
CIPLA,
LUPIN,
SUNPHARMA
Divislab Hour- Sell 1298, stop 1320 tgt 1240Divislab is showing weakness and can be sold at cmp 1298, stop 1320.
DIVIS LABS - PINBAR CANDLESTICK PATTERN STRATEGY The pinbar candlesticks indicates rejection of prices on high levels and also indicates selling pressure at resistance levels. In the above chart, 1380 -1350 acting as resistance zone where we can see rejection of prices due to high selling pressure. The prices may go down to the previous 52 Week high levels to regain buyers in the momentum and also confirmed it as a new support levels.
It is also worth to note that the previous high levels where our target is placed is at 61.8 retracement levels that also indicates the importance of the said levels
lets buy DIVISLAB 1190/1194 Stoploss 1178 Target 1210Above 1210 if stay 10min with high open interest blast upto 1240/1260/ lets see what happens
DIVIS looks BEARISH It is trading in a range bound within a triangle, overall long term trend looks bearish and now it is an good opportunity to short and be with the trend.
Divis Lab in major Triangle consolidated patterLooking for a breakout downward as a correction of on-going massive impulse leg.
Get your zoom lens cleared, shot opportunity can come in the way.
