Nifty Pharma at Triangle Reference; RSI Caution

Nifty Pharma has broken out of its long triangle consolidation on the weekly chart and extended the rally. The index is now near 28,900, with a weekly high around 29,225. That is close to the measured-move reference of about 29,200 from the triangle breakout. RSI at about 73 shows strong momentum, but it is also forming a negative divergence, with price making higher highs while RSI makes lower highs. A similar setup was seen around September 2024, after which the index corrected. A negative divergence is only a caution and not a reversal signal by itself. A reversal candlestick near the top would add weight to the caution, and until then caution is the operative word. The 200-week SMA near 20,160 is far below, so the broader trend remains intact, but after a sharp advance, consolidation or profit booking would not be unusual. Heavyweights such as SUNPHARMA , Cipla, Dr. Reddy’s, Lupin and Divi’s Laboratories are worth tracking for how they behave from here. The weekly candle is still forming, so the closing structure matters. The weekly candle is still forming, so the closing structure matters. Negative RSI divergence at a pattern’s measured-move reference is a caution, not a sell signal; a reversal candlestick at the top gives it more weight. Disclaimer: This is for educational purposes only and is not investment advice. Please consult your financial advisor before making any investment decisions. SEBI Registered Research Analyst — INH000025212.