Monthly Archives: August 2017

Is it Start of the End?

Infosys which has been pillar of many large investor portfolio since almost 2 decades, has taken a hit in last two sessions. This hit could be the Start of the End of Infosys era!  On 13th April, in my post “Can INFY loose its decade old rally?” , i already warned and initiated SELL call with tgts of 920, 840 and 790 of which we have almost reached 2nd destination.  Stock had been in long term consolidation of 3 years long in the range of 900-1100 and was finding out a reason to move out of the range on either side…And finally, we got…….

Resignation of  Mr. Sikka has been the reason of breakout from the consolidation pattern that too on downside. With such an instance it has also given two other bearish confirmation on monthly charts which means we need to be cautious for the stock in long term portfolio.

Firstly, Stock has breached 10 year old channel on Monthly chart which is a strong sign of trend reversal as the selling has been pretty much with higher volumes than average volume. BUT still confirmation would be done if it closes below 880 this expiry.

Secondly, we have got a probable H&S breakout on monthly chart with neckline at 880 level which is exactly at the same level where we got channel breakout.

Now technically on charts, 880 is crucial level to watch for next two weeks but on other side as of now buy back price is set 1150 levels which might be revised.   So when technical and fundamental is not going in same direction, we should avoid any new position unless we have clear picture of future. As a trader i would recommend shorts and as investors i am still intact with my targets of 840 and 790 which now trailing SL at 950! 

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Bottom is yet away!

Hello Readers! Finally after a long break am back to my blog. Nifty has crossed 10000 mark in pretty short time and so the correction which has kicked off is gonna be more sharp and deep from current close of 9837. Lets have a look at the Nifty daily chart!

So if we mark our recent rally to 10137 it was into a perfect channel which was breached down simultaneously with a bearish H&S pattern giving a tgt of 9839 which was achieved in No time. But  does that mean correction is over??..No…. H&S tgt is not a sign of end ….So now when we turn on it other parameters, we are getting some sign of more bearishness in markets. If you look at 20 day SMA (Orange line), was acting as strong support until the day we breached neckline of H&S. Now 20 day SMA is acting as strong resistance which is around 9950. We did resisted last week exactly at the mark making average a valid resisted.

What’s next stop?… Calculating Waves, i feel we are in the last thrust of corrective wave, Wave C. Though it would be a complex structure formation but we might be heading to 9500 (+/-50) in coming weeks.  Indicators on Daily time frame are approaching oversold zone so be u might get some lumps of bulls on the way down but we shouldnt get fascinated until we are completely over 10000 mark again. So as a trader  i would square off all longs on index on any rise near to 9900 mark this week and try my hand on selling with sl of 10000 for next series with tgt at 9500.