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We recommend a sell in Cipla from a short-term perspective. From the charts of Cipla, we see that the stock had been on medium-term uptrend from its January 2008 low of Rs 161, till it encountered resistance at around Rs 230 level recently.

However, the stock reversed direction experiencing selling pressure around the resistance Rs 230 and began to decline in recent times.

On April 28, the stock tumbled 4 per cent conclusively penetrating the medium-term up trendline as well as 21-day moving average, accompanied with good volume. With this decline, the daily moving average convergence and divergence indicator is indicating a sell.

The daily momentum indicator is falling in the neutral region and weekly momentum indicator has entered the neutral region from the bullish zone. Considering the penetration of the medium-term up trendline, we are bearish on the stock in the short-term. We expect the stock to decline further to our target price level of Rs 186 in the upcoming trading sessions. Investor with short-term perspective can sell the stock, while keeping the stop-loss at Rs 228 level.

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