Hello Traders,
Our Last weeks Untouched beauty Godrej Properties was up 5% and the rally continues… and if you havent read yet click here to read what was our view on Godrej Properties as it has further more handsome upside
Today we are going to look at something which is not a written rule but gives fantabulous returns many a times.
The stock market never remains fair either it is over optimist or over pessimist and these two situations create opportunities one who understands it and threat to one who can’t!
Eventhough the nifty index touched 18000+ in yesterday’s session this pharma stock has been underperforming for the past 1.5 year.
The negativity or bear push made the stock trade below 300 in the past 2-3 sessions which is telling us that laurus lab is now trading 58% lower from its August 2021 Peak which was 723 and currently trading 30% discount to the 200 Day Moving Average which is placed at 425 (see chart below)
chart source: TradingView. Daily Chart of Laurus Lab
If we look at the Weekly chart below,
we can see the stock has fallen in to weekly demand zone which was a reversal point earlier,
The current weekly candle has a long shadow which indicates huge buying on the weekly chart and the candle formed is a Bullish Hammer pattern indicating bullishness
If Laurus Lab can sustain at current level and does not fall below the recent weekly low of 278 then there is huge potential for the stock to deliver 30 odd percent return in next 6 months time.
Psychological view is telling that the retailer are not liking the stock and probably the big players are putting money in to it which can be seen with the money flow indicator (which has traded below level 25) on the weekly chart, never before in the past 3 years the indicator showing such kind of levels and telling us smart money is going in the stock and probably dumb money is getting out.
Thats why our view of extreme pessimism can produce us one of the extreme opportunity.
Hope you liked the post,
do share it with your trader and investor friends & foes…
before that let me share one positive Quote Of The Day
“Longevity is the key to success” –Ed Seykota
Happy Reading…..
Happy Trading….
Be A Wealthy Trader…..
