Small & Midcap Mantra: Bullish Flag in Eris Life sciences looks like a buying opportunity
Eris Lifesciences hit a fresh 52-week high of Rs 782 on July 1 but has since been consolidating leaving swing traders wondering if they should buy, sell or hold.
Experts noted that the formation of the bullish Flag pattern in the charts of Eris Lifesciences offers a fresh entry opportunity to enter the stock on dips. A Bullish Flag breakout is usually formed in stocks with a strong uptrend. It is a pattern that resembles a flag on a pole. Here the pole is formed due to the vertical rise in the stock price and flag results due to consolidation in the stock price.
Shares of Eris Lifesciences have surged 28 percent so far in 2021 compared to the 12 percent rise in Nifty50, and a 17 percent gain in S&P BSE 500 index.
On a 1-year basis, the stock has marginally outperformed Nifty50, and the S&P BSE 500 index, rallying 67 percent.
Moreover, the stock is trading well above crucial short-term and long-term moving averages on the daily chart such as 5,10, 20,50,100 & 200-Days Moving Average. This further reaffirms the bullish stance on the counter.
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Eris Lifesciences Ltd is the only publicly listed Indian pharmaceutical company with a pure-play domestic branded formulations business model. It is a fully integrated pan-India business with a revenues stream of Rs 1,200 crore.
“The stock has been a laggard within the pharma space. We expect it to witness catch-up with the rest of the pharma stocks backed by a positive price structure. It is forming a higher peak and higher trough on all time frames and recently generated a bullish Flag breakout signalling continuance of the uptrend and offers a fresh entry opportunity,” Dharmesh Shah, Head – Technical, ICICI direct said.
