Dramatic Market action in Sun Pharma share prices, Stocks rallied the most in nearly 6 months. Short sellers are exiting in panic after US Drug regulators said it may not pursue any further regulatory action on the firm. As the famous market adage goes “Price discounts everything”, Price action is already reflecting the changing fundamentals and forms Trend termination structure against the Downtrend in Daily chart.
Sun Pharma Price Action Analysis on Daily chart
In a Relief for the country’s largest drug maker, US Drug regulatory firm FDA issued a VAI so-called Voluntary action indicated status to its Halol plant in Gujarat. The VAI Status technically means, Sun Pharma will now have to make voluntary changes to the plant if needed but any adverse action by the regulator is unlikely. In the perception of Investors, it’s actually good news for the firm, may help out Sun Pharma in capturing the US market business again. As an expectation to this, Share prices rallied sharply in last two weeks.
From Price action perspective, Market has formed IRI Structure. (It’s a trend termination setup; we cover more about this in our training program) Short sellers and Bears who took positions based on earlier downtrend are liquidating their trades on the basis of changing fundamentals. Short covering has to be the major reason for sharp rally we saw in last two weeks. We might see more opportunities and trading setups on coming weeks in Sun Pharma. It’s time to add the stock in watch list.
