Sun Pharmaceutical: A bright future ahead as stock surges to seven-year high

Sun Pharmaceutical Industries Ltd is a prominent player in the pharmaceutical industry, specialising in the manufacturing, development and marketing of a wide range of pharmaceutical products. Their offerings include tablets, capsules, injectables, inhalers, ointments, creams, and liquids. Founded by Dilip Shantilal Shanghvi in 1983, the company is headquartered in Mumbai, India, and has grown to become the largest pharmaceutical company in India.

A recent analysis of Sun Pharmaceutical Industries Ltd’s stock performance unveils an intriguing story. In early August 2023, the stock reached a high of Rs 1,169.70, marking the beginning of a retracement phase following the previous rally that commenced on May 18, 2023, at Rs 922.45. This retracement lasted for over 61 days, finding solid support at the 38.2% Fibonacci retracement level.

During a recent trading session, a surge in buying interest drove the stock to a seven-year high, and it now appears poised to close above key short-term daily moving averages (DMA).

Notably, a significant breakout trendline has emerged, connecting the high point of August 3, 2023 (Rs 1,169.70) with the peak of September 29, 2023 (Rs 1,167.40). This formation represents a technical continuation price pattern that has unfolded over a 61-day period.

In today’s trading session, the stock experienced an upward movement of over 1.70% and reached a day high of Rs 1,171.50, surpassing the mentioned breakout trendline at Rs 1,165. A closing above this breakout level will confirm the breakout. The 14-day RSI, currently placed in the super bullish zone at 62, instils optimism among investors.

With a potential target set at Rs 1,400, representing an approximate gain of 20% from the breakout threshold at Rs 1,165, this scenario presents an enticing opportunity for both swing traders and long-term investors who closely monitor Sun Pharmaceutical Industries Ltd’s performance. The company’s trajectory offers a promising outlook, brimming with potential for further upward gains.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.