June 14, 2018 / 6:51 AM / 9 months ago

BUZZ-India's Sun Pharma shows signs of bottom formation

** Sun Pharmaceutical Industries, which has lost more than a third of its market capitalisation in the last three years, shows signs of reversal in downtrend

** Stock shows signs of a double bottom formation, bouncing from 435 rupees last month, a level at which it took support in Aug, 2017 reut.rs/2JHejoR

** A surge in stock’s daily volume also supports the pattern; the five-day average volume is nearly double its 30-day average which itself is 36 pct higher than its 200-day average

** Stock’s 20-day exponential moving average(EMA) cuts above its 50-day EMA, a bullish sign

** Stock’s Trend Intensity(TI) indicator rises to 20, suggesting stock is in early stages of an uptrend

** Stock is expected to test resistance at 614 rupees as long the support at 545 rupees holds; the two levels are identified as the 23.6 and 14.6 pct Fibonacci retracement level of the downtrend from April 7, 2015 high to Aug 14, 2017 low

** A break above 614 rupees will confirm the double bottom pattern and may lead to gains towards the next resistance at 726 rupees

Reporting by Gaurav Dogra

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