Zydus Lifesciences (NSE:ZYDUSLIFE)Overview: Zydus Lifesciences is currently at an interesting juncture, with signs of a potential reversal from recent lows. The price action suggests a possible recovery towards higher resistance levels, supported by technical indicators and market sentiment. Nomura's revised price target of ₹1,030, while maintaining a Neutral rating, aligns with this view.
Key Levels to Watch:
Current Price: ₹966.65
Immediate Support (SL): ₹902.55
Key Resistance Zones: ₹1,008.35, ₹1,041.45, and ₹1,102.15
Technical Analysis:
Volume Profile: The visible range volume profile shows significant accumulation near ₹1,000, which could act as a strong magnet for the price.
Moving Averages: The stock has started reclaiming its short-term moving averages. A breakout above the 200-day MA would confirm bullish momentum.
RSI (Relative Strength Index): The RSI is trending upwards, indicating improving bullish momentum. Divergence suggests a potential reversal.
Price Action: The formation of higher lows near ₹949 reinforces the possibility of a short-term recovery.
Trading Strategy:
Entry Zone: Between ₹950 and ₹970, as the stock shows stability near support levels.
Stop-Loss: Strict stop-loss at ₹902.55 to limit downside risk.
Targets:
Target 1: ₹1,008.35
Target 2: ₹1,041.45
Extended Target: ₹1,102.15
Risk Management:
Position size will depend on risk tolerance, ensuring a Risk-Reward ratio of at least 1:2.
Avoid chasing the price above ₹970 if momentum wanes.
Final Thoughts: Zydus Lifesciences presents a favorable risk-reward scenario with clear technical signals for a rebound. However, macroeconomic factors and sector performance will play a critical role in sustaining the move. Traders should monitor price action near the resistance zones closely for signs of continuation or rejection.
