CNX Pharma : Is major reversal on card?

Pharma sector has been the darling not only of Mutual Fund Managers but also of the major retail investors. The Pharma stocks have delivered multibagger returns over the last few years and some of the counters from Mid & Small Cap categories have given multi-fold return in no time. The entire sector witnessed a very sharp bull run from 6400 levels up to 14000 mark. However during recent past some the counter from pharma space has taken nose-dive and have broadly under-performed the broader markets.

The CNX Pharma index has been facing resistance around 12000 levels. It successfully breached its resistance zone of 11700-11750 levels during recent past but could not capitalize the same today closed below its support level of 11400. The index has now entered a multiple support zone of 11300-11000 and the breach of the same on closing basis may lead further selling and may drag the index to 10800-10600 levels which is the major support zone for the index. Consecutive closes below 10700-10600 levels may add more pressure and we won't be surprised if the index 9800-9500 levels. For any sustained up-move consecutive closes above 12000 levels by the bulls are required. Traders can cautiously look for shorting select pharma stocks to benefit from the potential south-ward journey.

 Extreme caution is necessary at this point as we have have already mentioned that it will be trading around multiple support zone. 

Bank Nifty Levels

The Index has been trading around its tough resistance zone of 19200-19300. The close above same may provide the fuel and it may move to post fresh high. Strong support at 18000 which is the Golden Ratio.

Intraday Support & Resistance 

Pivot Point: 18955

Support : 18880-18820-18685-18550

Resistance : 19015-19090-19220-19355

CNX Pharma

The Index seems to have formed a very strong base around 11600 levels during recent past. Today it formed a pin bar pattern and couple of Doji Candlesticks formation is also clearly visible on a daily chart. On a weekly chart it has been forming Doji. So the Daily & Weekly chart readings clearly indicate the exhaustion of supply around 11600 levels. Besides other technical indicators too looking tired possible bounce from current levels can't be ruled out in a near term. As long as 11600 is not breached on a closing basis we believe that chances of further fall from here seems limited. So considering the Risk/Reward ratio at current levels traders can bet on select pharma stocks for possible up move up to 11800-11850 levels in a short term.

CNX Pharma : Time to Take Bitter Pill?

The Pharma stocks have consistently outperformed the broader markets so far.Even during global markets turmoil they have shown great resilience. So at this juncture we tried to analyze the CNX Phamra Index and found interesting observations on a daily as well as weekly chart.

On a daily chart the Index has been consistently respecting its 200 DMA and again the Index is near 200 DMA.  It seems that the Index has very strong support around 12000 levels holding the same we may see bounce back in a near term.

 On the other hand on a weekly chart the Index has been consistently respecting its 50 WMA. As per weekly chart 11850 is the crucial level and holding the same 13200 to 13500 levels can't be ruled out in a near term.

So putting together Daily and Weekly observations chances seem to be very bright that the Index may witness bounce back from current levels. Traders can look for select Pharma stocks from Large and Mid Cap space to benefit from the possible bounce back. At this point the Index offers lucrative risk-reward ratio and taking exposure to Bitter Pills may prove Sweet for the Wealth.

CNX PSU Bank - Relief Rally On The Card?

The Index took nose dive from its all time high level around 4460 levels and witnessed a sharp correction. Just a couple of sessions ago it formed Doji and today the Index formed a strong Bullish Engulfing Candlestick on a daily chart. As per Fibbonaci it has witnessed almost 61.8% retracement and now hanging around the said level. Besides Bullish Divergence of RSI is clearly visible on a daily chart suggesting that bears are losing grip at least temporarily. During recent past the Index has found support around 3100 levels and facing resistance around 3190 levels. Looking at the current Technical Set up it seems that once 3190 levels is captured on a closing basis the Index may witness relief rally up to 3290 to 3335 levels in a short span of time.  Trades can keep on radar select PSU Banks for swing trading purpose.

Bank Nifty

The Index broke its 200 DMA during recent past and posted swing low of 17376. The bears could not hold the Index below its 200 DMA and gradually it started its upward journey. As per Fibonacci Retracement the Index has managed to close just above its Golden Ratio. Besides it has also captured its short term moving averages on a closing basis which is a bullish sign. On a daily chart it seems that the Index has formed a Falling Wedge chart pattern which indicating the continuation of northward journey.

 As long as the Index trades above its Golden Ratio placed around 18650 levels the view remains bullish. On the other failing to hold 18650 on a closing basis we may see selling pressure.

Resistance 19100-19500 whereas support at 18400-18150

We have RBI Monetary Policy review on 2nd June, 2015 which is expected to set the further tone for the Index and broader markets. 

CNX Metal

Metal Stocks to Shine?

 

The Index has been quite under performer. However the index found support around 2280 mark and started steady recovery. During recent past the Index captured its short term moving averages but it found resistance around 2515 levels and failed to capitalize the move. However today the Index formed a strong bullish candle on a daily chart and bulls managed to capture 20 & 50 DMA. Again today the index knocked at 2515 but missed to give close above the same. With other technical indicators turning bullish it seems that earlier fall might be shake out and metal stocks may continue to shine in near future.   

Consecutive close above 2515 + weekly close above the said mark may take the index to kiss 2690-2730 levels. The strategy that investors can adopt is to buy metal stocks on dips as long as 2400 level is not breached on a closing basis.