In last week we had discussed about the NIFTY Pharma Index. Let’s take a quick look at the performances of major indices for current week.
As you can see the overall performance in many sectoral indices is Negative except Pharma Index and to some extent Metal Index. The NIFTY PHARMA Index closed at 11883.20 compared to 11667.10 in the previous week i.e. 216 points (1.85%) upwards despite overall selling pressure across all equity market.
Are you wondering why this could have happened?
The NIFTY Pharma Index is called safe heaven index or defensive sector compared to all other sectoral indices. And this is one of the reasons behind the performance of this index, as we know that in any diverse situation or condition we cannot avoid to consume medicines and hence the pharma sector is safe from being affected. So whenever there is selling in other Sectors, we can observe buying in the Pharma Sector. In other words we can say that smart investors shift their investments from other sectors to Pharma Sector. The same thing we had predicted with the help of Technical Analysis. And this is what we want to highlight that Technical Analysis is not just about Chart Patterns but a huge Data Science.
As shown in above chart; we are observing formation of a Bullish Harami type of Chart Pattern on weekly chart of NIFTY Pharma Index which is suggesting towards a further bullish view if previous week’s high i.e. 12056.25 is broken on upside in the coming days. Momentum indicator RSI at 48.67 is also showing positive divergence confirming the strength in the Pharma Index.
Mr. Digvijay, Co-Founder & Technical Analyst, Arthvidya Wealth Mantra
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GROWTH EDGE INVESTMENT PRIVATE LIMITED
1.My company in not investing in Derivatives. So how we can Buy fair pharmaceutical company share out of from Index.
2. Please share good quality stock from outside of any Index.