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.