Buy Cipla for trading and short term investing

Short term investors and traders can go long on Cipla Ltd. as the stock has hit new 52 week high supported by increased volumes on the back of news of the company winning a patent case against Roche in Delhi high court. The company has also reported very strong July quarter numbers which is creating positive sentiment for it's stock. Valuation wise the stock is expensive but one of the cheaper stocks among large cap pharma names listed on Indian bourses which is triggering the fresh buying interest in the stock.

Traders can go long on the stock at 389 - 392 levels with a stop loss placed at 384 (a notch below the saturday's 8th Sep low). Short term investors can go long in the same range with stop loss placed at 371 (a buck lower than the weekly low for the stock). On further rise in the stock price adjust the stop loss insurance levels accordingly.

The trade is expected to generate 5 - 10 percent return in 2 - 3 weeks times.


Amit Agarwal said...

The stock reversed and lost momentum suddenly. The stop loss is triggered for the trade :(

Anonymous said...

Thankfully I decided to wait n watch before acting on this call :-)

Amit Agarwal said...

The stock failed to react like TCS, HUL and Lupin which went on hitting new highs after hitting 52 week high. But I think when a trade becomes too obvious it becomes obviously wrong. That is why whenever we do trading, which is exactly opposite to the way we select stocks for investing, stop loss is a must.


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