Monthly Archives: March 2013

#3 Article: When on a tip of the Ice-Berg……

                         Just Imagine yourself on the tip of the Ice-Berg!! When you look down you will feel that ice-berg ends at the water-level but the basics says the height inside the water is more than above water. Nifty traders are exactly standing at the tip of the iceberg. Today we saw nifty closing below 200 EMA for second consecutive day which is weakening the bull run. Political surprise + Cyprus banking freeze has made nifty chart take a u-turn. Three Charts above are of three different markets which are inter-related. Top left is USDINR, Top right is GOVT 10 YR BOND Yield and down center is NIFTY Chart. Bond Yield and USDINR are inversely related to Nifty.. But Nifty may lag in reacting to bond yield. Or you may say that bond chart shows the signal early. Now check out the yellow line on bond chart, it made a top at 7.96% on 4th Feb and it has closed at the same level today which is acting as a resistance. But now we see a rise in yield from monday or next week than that the sign that Nifty may seem downfall. Now taking USDINR chart, it has also the same implications. USDINR has been in the symmetrical triangle formation which could breakout on either side but indicators suggest this time it will break 55.40 which has acted as support thrice but before that 54.95 is a small breakout on the way. Now weakening rupee is another indicator adding to the weakness to Nifty chart.

                       Coming to our Nifty chart we have seen two things breaking at the same level. First, a trendline as seen on the chart and Secondly, 200 EMA (Not plotted) at 5672. So technically we have got some weakness in the markets. On my Last article 3..2…1..Go!! i mentioned that 5630-5690 is strong support and we did see 300 points rally from that point but than Political instability came as the shock to the country. All the technical and fundamental analyst were made to think other way round and now it seems gates have opened for 5447. In my article i did mentioned that below the support range of 5630-5692 we may see the level of 5447 and now chart has shown signs that IT MAY move towards that level. To support my view, we even have a unfilled gap at 5447 which could be the support to be filled up.
                     
                      Next week is gonna be important for our markets as Cyprus case would have a final resolution plus financial year ending and top of it holidays in trading session. All the three market moves on next week should be closely watched to predict the future of our market.

Strategy: As i had mentioned in my last article on 25th Feb that 5400-5630 is no trade zone for the long term investors. Yes ofcourse that could be the low but you never know as i said that iceberg could be more dangerous than it seems, so its better we sit quite. 5560 is a small but important hurdle that may act as a key reversal point after 5630 but before 5447. So now add longs only above 5850 or else just hold your position. To hedge you porfolio Buy 5500 PUT Option of MAY expiry at 68. So right now we are in no trade zone. If we see political stability than we may see new high in month of May.

           
                   
                     

                     

#149 Nifty Update: Get in early. You might miss the bus.

As i have been tweeting at @Chartechnician that we must not short positional unless close is below 5825 and hope you all got that. Yes, I did mention to add long at 5875 in my last post for Nifty few days back. Adding longs at 5875 would been fruitful for those who followed that. 5954-5975 were the next levels which i mentioned to add longs who has missed opportunity at the low but now i would like to revise that buying opportunity at CMP or around 5900. As i studied the chart with more preciseness,5900 has came out to be crucial level and we saw that today markets closed above that level giving some early confirmation for the bull momentum in the near future. Now two revised buy levels are 5900 and 5975 on charts. We also saw ‘bullish engulfing” pattern today on Nifty chart which indicates a buy call.  Yes today HDFC Bank scam had got some fear in the traders but i guess now its all subdued. We saw a recovery of almost 2% from the low today. Recovery was just the support we wanted for the bull run. Inflation and data was announced today and consolidated was higher than expectations but Non-Mfg inflation has decreased and its gud for our economy. Now we may expect rate cut on 19th March from RBI which may add fuel to our Bull fire. So our strategy now is to buy on every dip with stop loss of 5820..

#32 Stock Update: Recommending Telecom sector Pick- "tata communication"

Sector
Call Date
Initiated price
CMP
Tgts
Return
Maruti Suzuki
Auto
30/10/2012
1390
1418.80
1789/2870

2.08%
Dena Bank
Banking
11/2/2013
104.55
95.80
156/195/256
-8.37%
Tata Motors
Auto
12/2/2013
298.55
301
375
0.8%
Adani Enterprise
Mining
18/2/2013
232
240

435/897
3.44%
Ambuja Cement
Cement
25/2/2013
200
190.50
280/325
-5.00%
Ranbaxy
Pharma
12/3/2013
417
433
572/697/1166
3.8%
TaTa Communications
Telecomm
14/3/2013
233.75

233.75
290/392/523
0%

Today i am initiating a recommendation in Telecom Sector. You must be surprised with my stock selection “Tata communication”. Though its not much active amongst trader as much as Bharti,Rcom or Idea,but its a defensive choice. Group company is what has attracted to me and ofcourse technical chart. Stock has seen a high of 783 (approx) and thn saw a low of 191. But it has than consolidated for almost a year now. Consolidation is the sign that stock may see some bull momentum. one year of consolidation is the key factor defending our choice. Taking into consideration its fundamental, it running through some debt issues but it on the verge of completing a land deal worth of Rs, 2500 crore. If the land deal is closed in near future than 290 tgt is much possible by than. Long term target though is coming down to 1300 though its in nxt 8-10 years. But its a gud bet and it can work as a insurance to your portfolio. Keep a stop loss of 191 and just go long at CMP. After entering this stock in our portfolio, nw we are exposed to all key sectors of the economy. Now its tym to find some risky stocks and they are coming soooon……

#148 Nifty Update :Nifty reacted to Inflation rather than IIP

Two sets of data were declared today IIP, which was better than estimates and Inflation, which was slightly higher than previous month. Nifty was trading at new high 5952 when IIP was announced but than plunged when combined inflation was announced.  Though its simply profit booking on nifty bt investors can take this as negative reaction of traders to data. RBI policy is to be announced soon and investors are wagy. Now we have seen some bearish pattern formed today..tomorrow we need confirmation for same..so strategy tomorrow is go long above 5925 n short below 5900
.thts STRICTLY intraday. While positional traders add long above 5954. So there is no short opportunity on chart as of now for positional trade…so my range for tomorrow is 5900-5925

#31 Stock update: Our Porfolio status as of 12th March

Stock
Sector
Call Date
Initiated price
CMP
Tgts
Return
Maruti Suzuki
Auto
30/10/2012
1390
1417
1789/2870
1.9%
Dena Bank
Banking
11/2/2013
104.55
96
156/195/256

8.2%
Tata Motors
Auto
12/2/2013
298.55
305
375
+2.1%
Adani Enterprise
Mining
18/2/2013
232
240
435/897
+3.4%
Ambuja Cement
Cement
25/2/2013
200
190
280/325

-5%
Ranbaxy
Pharma
12/3/2013
417
417
572/697/1166
0%
Overall
-1%

#147 Nifty Update: 5975 a strong resistance in nifty for this week

As i had mentioned in my post on 25th Feb that Nifty could take support in the range of 5630-5690 and same thing happened.  Nifty consolidated and made low at 5663 n bounced back strongly as it was expected technically. Now it is headed towards new high but we may see some speed breaks. 5968-5975 is strong resistance zone on the charts. We saw three running gaps supporting the bull momentum. NIFTY has resistance nr 6009 and 6030 above 5975. Now if we see opening below 5946 tomorrow thn we could see correction upto 5874. Strategy wld add long above 5975 or add longs at 5875 if we see weak opening tomorrow.  But DONT go short