Glenmark Pharmaceuticals Ltd (NSE) (GLENMARK.IN)
Along with underperforming the broader markets, Glenmark Pharmaceuticals has been underperforming the pharma group as well. Over the past couple of weeks, the stock has been consolidating in a 187-215 range while creating a congestion zone. Now, a few signals have appeared that point towards likely technical pullback by this stock over the coming days.
The RRG points out that the stock has completed its bottoming-out process on the daily charts, as it remains in the improving quadrant when compared against the broader NIFTY 500 Index and NIFTY Pharma Index.
The RS Line is seen reversing its falling trajectory; it has penetrated its 50-DMA, which can be taken as a confirmation of this action. The daily MACD is bullish as it is trading above its signal line. The PPO remains positive.
The RSI shows a bullish divergence, as it has marked a fresh 14-period high while the price has not yet done so. The price action is likely to follow suit.
If the present technical setup is resolved on the expected lines, the prices may pull back to test the 50-DMA, which translates into potential upside potential of over 29%.
Any move below 185 on the close will turn out to be a failure of the present technical setup.
Milan Vaishnav, CMT, MSTA
Consulting Technical Analyst
