Dr. Reddy’s Laboratories launched omeprazole delayed-release tablets, 20 mg, an over-the-counter (OTC) equivalent of Prilosec OTC in the US market. This has helped the stock trade in the green in an otherwise volatile market.
The company’s drug is approved by the U.S. Food and Drug Administration (USFDA). Omeprazole delayed-release OTC tablets is a proton pump inhibitor used to treat frequent heartburn occurring two or more days per week in adult patients. The management believes this launch will expand Dr. Reddy’s OTC portfolio.
According to research firm IRI’s data, Prilosec OTC and private label omeprazole OTC products had a combined retail sales of approx. US$492 million for the 12 months ending in October 2018 in the US market.
The big bear candle at the top was the first sign of weakness in Dr Reddy. The same has been circled on the charts. The stock halted at the Fibonacci confluence zone of 2768-2817 and retraced to around the 3800 levels which was the last opportunity to exit the stock. The stock then broke the fib confluence zone and retested the zone several times. The retest was the confirmation of the break of an imp support which was now resistance. The stock made a +ve divergence at the 61.8% of the larger swing. Divergence at an important support should be given significance. The stock indeed reversed from there and is back to the Fibonacci confluence zone of 2768-2816. Therefore it is at a make or break zone now that it is nearing the confluence zone. Therefore will the stock make a lower low in the zone or move higher needs to be seen. The trend is clearly down and therefore we need to be watchful here.