The stock of Ajanta Pharma, like most of its peers, recovered swiftly after witnessing a sharp fall in March 2020. Since then, the stock has been appreciating. Nevertheless, the uptrend has not been sharp. Though it entered 2021 after producing a substantial return of nearly 68 per cent in 2020, the stock could not maintain the upside momentum. Since the beginning of the year, it was largely oscillating within the support of ₹1,700 and the resistance band of ₹1,860 and ₹1,900.
The momentum that the stock has been building over the past week has been good and it was enough to lift the stock above the resistance band mentioned above. After breaching ₹1,900, the stock hit a new multi-year high of ₹1,974.5 on Wednesday before closing the day lower at ₹1,947.8. However, the outlook has turned positive following the high volume breakout and supporting the same indicators like the RSI and the MACD are showing fresh uptick. Hence, one can buy the stock with stop-loss at ₹1,890 and a target of ₹2,050.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)