Pharma index gives further downside, trails below major support

When the whole market was tumbling, Pharma sector was not an exception on Friday. Nifty Pharma index too plunged 1.4 per cent, though it still outperformed the benchmark indices which fell more than 1.5 per cent.

Pharma giant, Sun Pharma which holds 28 per cent weightage in the index dropped 2.6 per cent and thereby dragged the index down. Further, Cipla that holds 14 per cent in the index slipped 1.6 per cent. Barring PEL, Divis Lab and Auro Pharma, all other stocks ended in green. Pharma stocks which form 3.78 per cent of the Nifty50 index contributed to the fall.

Technically, the Nifty Pharma index has been trading with lower tops and higher bottoms since July 2017. Thereby it formed a Symmetric Triangle pattern on the daily time frame, starting July 20, 2017. The index witnessed a breakdown at 9,140 levels on February 2, 2018. The index fell up to 8,730 levels and bounced back up to 61.8 per cent retracement of the prior downward rally. Thereafter, the index took multiple support near 8,730 levels. However, recently on March 7, the index breached those levels too and is now trailing below the said levels. Going forward, 8,500-8,470 will act as major supports, followed by 8,315.