Ajanta Pharma recorded a high of ₹1,086 on Monday, before correcting. Since then, the stock has been unable to breach this high and extend its upmove. Although the trend is still up, the 3.2 per cent fall in the last two trading days is signalling that an intermediate top is in place for the stock. The price action on the charts suggests that a corrective fall is possible in the short term. Also, Wednesday’s 1.4 per cent fall has been accompanied by strong volume, strengthening the case for the stock to extend its decline in the coming days. This offers a good trading opportunity.
Traders with a short-term perspective can initiate fresh short positions in this stock. Stop-loss can be kept at ₹1,075. Thereafter, ₹1,000-950 is a strong support zone. The stock can reverse higher again from this support zone. So, traders can exit the short-position with the target of ₹1,000.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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