Akhil, I'm pretty sure you didn't open a dashboard to try this out before answering :)
I've noticed this limitation on my end as well, and the way I normally get around it is by creating two reportlets: one with only the graph, and one that contains each day. Though this method takes a little more room, it also allows me to create two graphs for the report, one for the month and one comparing it to previous months.
Another way I do it is by separating the line items into different columns; this works in landscape layout as well. Add the first 15 line items in one reportlet, then add the last 16 line items in another.
Some graph types take up less vertical room than others, so if you have something simple like a bar graph, you'll sometimes be able to fit 30 days + the graph in your reportlet.
