19 July 2011

Dr. Reddy's Laboratories – Last Close 1576.05(18-July-2011)


The above weekly chart shows the bearish outlook for short to medium term. Technically, Weekly Head and shoulder pattern breakdown spotted which indicates the stock is in the hand of bears. And now the pullback to the cluster resistance (Apex point and 61.8% Retracement) also tested.  In addition the stock moves within the falling channel which is vital bearish structure. Overall the stock moving toward bottom of falling channel line or 38.2% retracement level of last major rising leg placed around 1300.

In outer extent if the stock moves below 1300 then bearish outlook continues with the breakdown of lower channel line, and it heading toward 1100 which is 50% retracement level of last major rising leg. Unless close above 1625 channeling and wave suggests the stock is bearish for short to medium term.

Until the stock trades below 1625 (Close) it’s in the bearish territory for short to medium term.

Strategy:
Sell the stock at CMP for the Target of 1300 - 1100.
Vital Resistance placed at 1625 levels.

No comments: