Sensex Technical View :
Pasting yest view as it still remains the same.
Sensex Technical View :
Sensex bounces back sharply from the momentum trendline which was around 10700 and is now in striking distance of the recent highs of 11370.
The flag range is almost 600 points which implies 2-3 sessions above 11350-11400 could lead to a similar move. Possible targets 11650/11900.
Lot many global indices are similarly shaped and some have broken above the March 2nd week high ( similar to Sensex 11370 ). A small breakout move in the week could be witnessed in many global indices. ( CHECK POST BELOW FOR GLOBAL INDICES CHARTS )
As explained below a breakout if happens in short term above 11370-11400 on sustaining basis would be very volatile and trick stops of traders also. Investors should look to book profits , re-shuffle their portfolio and reduce stocks which they are not truly convinced of and build a stronger portfolio.
The current move if one has to trade then should be nimble footed and strict as there might be many whipsaws in specific stocks also. Reduce volumes if not able to follow discipline.
Stocks to watchout for :
Larsen is about to breakout above 910 , KFA tricks with a pullback 38.5 stop if already taken, Mundra not yet moved above 420.
Max continue to remain bullish in the long run 155 zone resistance for now.
CIPLA
The stock has given a breakout above 245 zones today but did not sustain. If continues to stay above 234 may expect a move to 265 levels also.
Risky trading picks --- Keep volumes low and strict stops
Voltas can give a small move if holds above 58. Tgts 66/72.
LnT stop of 884 can tgt 940-960 zones also.
ONGC stop 830 tgt 885-900. Weak below 830
Sensex -
Sensex - Forming a flag around the top of channel
Nikkei also a flag around the top of channel
FTSE - also a flag but not a clear channel
Nikkei also a flag around the top of channel 
CAC - France also close to top of channel
FTSE - also a flag but not a clear channel
Dow Jones - Clear channel and sideways flag ...
Observations :
As we see all world indices have clearly come to the top of the channel and many of them are making flags around this zone.
Technically a flag breakout is a continuation pattern. Currently we are in an extreme short term uptrend so a breakout above the highs of the last few weeks may lead to a smart move.
As its a major channel breakout which is almost a 25-40% would be very difficult to get clearly out of it in the first move. So a breakout from here may also be illusionary but quick with lots of volatility and investors should be out of their holdings in this period then to try trade it ( nimble footed traders can definitely use it )
Possibly we could see a quick move with volatility which may be equivalent to the size of flag which is around 7-12 % in log basis. The consolidation in the flag has not lasted many sessions so a breakout move has to be very choppy and volatile.
Continue to watch the lower line of the flags or short term lows for a trend change! in coming days or to keep trailing stops closer to those momentum/flag lines.
Essar Oil
The statement I check first is usually the balance sheet. Essar oil has a debt of almost 10000 Crores with a debt equity ratio of 1:5. In addition, the company has had losses in the last 3 of 5 years. The management also does not inspire confidence in this company. In a nutshell, the company and its fundamentals are too speculative for me.
Jai corp
The company has a very low debt level and seems to have raised considerable equity, to the tune of 2000 odd crs to fund the SEZ and real estate initiatives . Due to this high level of liquid cash, the company has considerable other income too. The income statement, net of this non core income, shows a profit margin of 6-7% (fy 2009).
Based on an expected turnover of around 400 Crs, the core operating profit after tax could be in the range of 25-30 Crs. Based on the above numbers, the company seems to be selling at a PE of around 40 (after netting cash from market cap and considering only the operating income).
The market is clearly pricing some of the new initiatives in the current price. It is quite possible the new initiative would do well and the current price could be a bargain. However evaluating SEZ and real estate initiatives is beyond my circle of competence and hence I avoid such types of ideas.
KLG systel
The company looks very cheap based on fundamentals selling at around 3-4 PE (based on Enterprise value). However I started with the analysis of the balance sheet and saw warrants being issued to promoters and some strategic investors at a price of around 351 when the market price was in excess of 400. The dilution was around 10-11% due to the warrants. In addition the company has also raised some usd 22 million through Foreign Currency Convertible Bonds.
My analysis of this company ends here. I am not interested in companies where the minority shareholder is diluted by preferentail allotment of warrants at prices lower than market price. If you think warrants in themselves are free, then by that logic call options which are similar to warrants should be free too. Have you seen any call options available for free in the stock market (especially with a strike price below current price?)
If the company needs capital, when why not have rights issue where all the existing shareholders get an equal opportunity ?
Selection criteria too strict ?
Should it be otherwise ? I typically hold 12-15 stocks in my core portfolio. A new idea should be of equal quality and better valuation for me to replace an existing one.
The above analysis was done in matter of a few hours. Unfortunately (or maybe fortunately) for me all the stars and planets and the rest of the stuff has to line up for me to start investigating the stock further. Even with all due diligence, I manage to get it wrong several times. I am definitely not stepping into those ideas where there are red flags or the company itself is out of my circle of competence.
The Indian market opened on lower note tracking weak global cues saw volatile session and close on flat note . For coming session 3416-3380 good support zone for nifty if nifty trade above 3492 it will test 3517-3542 zones. On the other side trading below 3443 it will test 3417-3380 levels.
CMP : Rs 442 Technicals Bullish 20/50 day EMA crossover in Aban on daily charts. Its a crade buy with stop loss 425 on EOD basis. Fundamentals Aban Offshore has announced its fourth quarter results. The company's Q4 consolidated net loss stood at Rs 93.04 crore versus net profit of Rs 33.92 crore. Its consolidated net sales were up 16.99% at Rs 774.08 crore versus Rs 661.64 crore and operating profit margin, OPM improved to 55.72% versus 50.65%. |
Essar Oil
The statement I check first is usually the balance sheet. Essar oil has a debt of almost 10000 Crores with a debt equity ratio of 1:5. In addition, the company has had losses in the last 3 of 5 years. The management also does not inspire confidence in this company. In a nutshell, the company and its fundamentals are too speculative for me.
Jai corp
The company has a very low debt level and seems to have raised considerable equity, to the tune of 2000 odd crs to fund the SEZ and real estate initiatives . Due to this high level of liquid cash, the company has considerable other income too. The income statement, net of this non core income, shows a profit margin of 6-7% (fy 2009).
Based on an expected turnover of around 400 Crs, the core operating profit after tax could be in the range of 25-30 Crs. Based on the above numbers, the company seems to be selling at a PE of around 40 (after netting cash from market cap and considering only the operating income).
The market is clearly pricing some of the new initiatives in the current price. It is quite possible the new initiative would do well and the current price could be a bargain. However evaluating SEZ and real estate initiatives is beyond my circle of competence and hence I avoid such types of ideas.
KLG systel
The company looks very cheap based on fundamentals selling at around 3-4 PE (based on Enterprise value). However I started with the analysis of the balance sheet and saw warrants being issued to promoters and some strategic investors at a price of around 351 when the market price was in excess of 400. The dilution was around 10-11% due to the warrants. In addition the company has also raised some usd 22 million through Foreign Currency Convertible Bonds.
My analysis of this company ends here. I am not interested in companies where the minority shareholder is diluted by preferentail allotment of warrants at prices lower than market price. If you think warrants in themselves are free, then by that logic call options which are similar to warrants should be free too. Have you seen any call options available for free in the stock market (especially with a strike price below current price?)
If the company needs capital, when why not have rights issue where all the existing shareholders get an equal opportunity ?
Selection criteria too strict ?
Should it be otherwise ? I typically hold 12-15 stocks in my core portfolio. A new idea should be of equal quality and better valuation for me to replace an existing one.
The above analysis was done in matter of a few hours. Unfortunately (or maybe fortunately) for me all the stars and planets and the rest of the stuff has to line up for me to start investigating the stock further. Even with all due diligence, I manage to get it wrong several times. I am definitely not stepping into those ideas where there are red flags or the company itself is out of my circle of competence.
Nifty :: Sensex and Nifty both made higher high today but Sensex close above last high and Nifty close below it . Once again Nifty made a Spinning top candle pattern at resistance zone.. From last three days we constantly indicate such kind of situation with highlighted white color.. Slowly-slowly both indices made an negative divergence at higher level.. As far as hold above 3384 situation under control for bulls.. For 28th April watch two level above 3467 momentum seems up below 3450 momentum down .. Our strategy for 28th April above 3467 buy on deep (S.L 3450) Sell at high.. Below 3450 sell at high (S.L 3467) Buy on deep (S.L 3384).. Resistance for up move at 3512/3518/3543/3572/ 3610/3636… Supports at 3450/3431/3400/3384…
(Be careful at higher level Nifty heading towards target level and enter in strong resistance zone.. All indicators are in overbought zone with negative divergence. Book profit at every high and avoid to give long commitment at higher level)
The Indian market opened on lower note tracking weak global cues saw volatile session and close on flat note . For coming session 3416-3380 good support zone for nifty if nifty trade above 3492 it will test 3517-3542 zones. On the other side trading below 3443 it will test 3417-3380 levels.Long Side
- Buy NIFTY Spot @ 3498 SL=3483 Targets=3505, 3529, 3537, 3549, 3558, 3568,
- Buy BANKNIFTY Spot @ 5227 SL=5183 Targets=5250, 5327, 5351, 5389, 5420, 5451,
- Sell NIFTY Spot @ 3476 SL=3489 Targets=3467, 3455, 3447, 3423, 3416, 3404, 3394, 3385,
- Sell BANKNIFTY Spot @ 5157 SL=5193 Targets=5126, 5088, 5064, 4987, 4964, 4925, 4894, 4863,
Uptrend continues. But momentum has weakened..If it is a correction, it should hold 3440 or 3400.A move past 3485-3495 may bring in the momentum.
With a long weekend ahead, volatality will be high as it was today.
Buy/ sell in the range of 3420 - 3520. Break on either side may bring in the momentum.
BSE Sensex has sucessfully broken out of Descending Channel thus affirming short term bullishness. Now for further target is 11400-11500 for the BSE Sensex.
The Steep ascending or uptrend channel on BSE Sensex has ruptured on the downside. But last friday candle 24/04/2009 has again gone back into the steep uptrend channel.This fastest rally has covered an almost 3200 points from low of 8160 on 09/03/2009 to high of 11367 on 17/04/2009. In the period of 30/3/2009 -17/04/2009 many simple & runaway-gaps up have also been identified in the uptrend channel. The rally which started with a piercing line trend reversal candle pattern on 30/03/2009, has now been slowed down with another powerful trend reversal candle pattern called "Dark Cloud Cover". This Dark Cloud Cover Candle pattern is top reversal powerful candle pattern.
If this Dark cloud Cover Candle pattern gets negated,then it means a this rally is very powerful indeed. Also this rally is going ahead on a rising volume. On monday longs should be careful and shorts also should be careful, since the BSE Sensex is still in the uptrend channel. As long as uptrend channel is intact the old longs are safe. If the weakness persists on higher levels, then lower side of the steep uptrend channel (10500-10700) may offer a good support level for fresh longs.
Short should only venture if the uptrend channel breaks-out or ruptures on downside with a volume.With strict stop loss.
Moving Averages
In the daily chart of BSE Sensex the last week all moving average from 13ema,34ema,50sma & 100sma were successfully crossed.The week of 20/04/2009 to 24/04/2009 proved to be giving tough resistance to 200 dma. But on 24/04/2009 last friday 200 dma has been crossed by BSE Sensex in daily chart..
Structure Of Sensex
Since low of 7700 in November 2008, Higher tops & Higher bottoms structure was identified. Structurally from January 2009 again it has given way to Lower tops & Lower bottoms. Current BSE Sensex structure is (Higher Tops - Higher Bottoms, Lower tops - Lower bottoms). The range between 10200-10700 is good support zone for BSE Sensex on reaction to downside.
Momentum Indicator /Oscillator
Currently in the Daily chart the KST momentum indicator is in overbought zone, indicating a strong rally. As long as KST Indicator remains in overbought zone bulls can be comfortable.
Volume
The volumes From November 2008 to January 2009 indicated accumulation. This accumulation is being authenticated by this powerful rally starting from end of March 2009. On 10/02/2009 highest volume was seen.In April 2009 the rally has been on a rising volume which is good indicator that the this rally is a powerful one.
Trendline
Since high of 21206, in January 2008, a clear descending channel is seen in the above daily chart of the Sensex. BSE Sensex attempted breaking out on upside on 4 occassions, dated -16/05/2008, 12/08/2008, 05/09/2008, 12/02/2009. But on 16/03/2009 BSE Sensex did successfully crossovered the descending channel on the upside.
Retracement
Since the fall from high of 21237...January 2008,the retracements of 32%-13097, the 50%-10597 & 61.8% -8096 levels.
BSE Sensex on 6/03/2009 made a low of 8047, thus covering 61.8% of the total fall and on 08/04/2009 crossed 10597, thus covering 50% retracement of total fall.
Sensex Key Support Level-- ----10673, 10998,11211
BSE Sensex Weekly Chart Till 27/04/2009
Currently in Weekly BSE Sensex Chart, on friday weekly closing has given a breakout of weekly descending channel.But this weekly breakout needs more confirmation in coming weeks.On further persistance of rally, the target of symmetrical triangle may become achievable.
So currently 11400-11500 is very crucial level for the BSE Sensex & breakout above the Weekly descending channel.
Old Overview of BSE Sensex Weekly Chart.
In the Above Sensex Weekly Chart from the high in January 2008, BSE Sensex has been trading in Weekly Descending channel. In October 2008 sensex broke out of descending channel signalling exhaustion and since then has been trading side ways below the descending Channel. This sideways trading has given to formation of symmetrical triangle.The symmetrical triangle often referred to as side-ways or consolidation pattern. It means before embarking upon any trend, it is breather period.The last week it was indicated that we will revisit the Symmetrical Triangle once again. Since Late february 2009-insert- bseseb 08/03/2009- it was indicative that BSE Sensex may give a down fall. Hence bearish scenario was taken into account.
Symmetrical triangle though are a continuation pattern usually. But sometimes Triangles may act as a reversal pattern also. As it is Triangles are one of the most trickiest patterns. Hence we revisit the pattern in BSE Sensex Weekly and have a re-look at our targets.
This weekly Triangle has given breakout downward at 9250. So now we will consider 9250 for calculations purpose.
Again this target of 13420 can be said to be achievable provided the uptrend line of the weekly descending channel (as seen in the BSE Sensex Weekly Chart) is crossed by the BSE Sensex on the upside which is 11400-11500 currently.
Momentum Indicator /Oscillator
In the weekly chart momentum Indicator KST though in the oversold zone but have given bullish cross over and is going up to zeroline,indicating rise in upward momentum..
But still the intermediate tone can still said to be bearish in the BSE Sensex. Unless KST indicator gives breakout upside into overbought zone, intermediate bullishness cannot be affirmed.
BSE Sensex Monthly Chart Till 27/04/2009
The January 2009 and February 2009 Candle pattern was Bullish Engulfing Pattern.The March monthly Candle was bullish belt hold line candle pattern.In the BSE Sensex monthly chart the sensex has support at 100sma which is at 8155 & 50 sma is at 12176 . Also for the purpose of clarity we keep The Dynamic triangle-pattern on the backburner till April 2009 candle is taken into consideration.
Unless 11400-11500 area is not crossed by BSE Sensex, the room for down fall remains. As has been indicated may times in all old BSE Sensex posts, that bull market or bull trend in BSE Sensex cannot said to be over for longterm till monthly uptrend line2 drawn from low of the year 1981 gets broken. And so far it does not appear to have broken. So long term BSE Sensex is still bullish.
Momentum Indicator /Oscillator
In the monthly BSE Sensex chart the Momentum Indicators or Oscillators KST is in over sold zone. KST Oscillator have not given any indication of forming any patterns or divergence. But possibilty of bullish crossing KST Indicator can be anticipated if upmarch of BSE Sensex continues.
With a long weekend ahead, volatality will be high as it was today.
Buy/ sell in the range of 3420 - 3520. Break on either side may bring in the momentum.
BSE Sensex has sucessfully broken out of Descending Channel thus affirming short term bullishness. Now for further target is 11400-11500 for the BSE Sensex.
The Steep ascending or uptrend channel on BSE Sensex has ruptured on the downside. But last friday candle 24/04/2009 has again gone back into the steep uptrend channel.This fastest rally has covered an almost 3200 points from low of 8160 on 09/03/2009 to high of 11367 on 17/04/2009. In the period of 30/3/2009 -17/04/2009 many simple & runaway-gaps up have also been identified in the uptrend channel. The rally which started with a piercing line trend reversal candle pattern on 30/03/2009, has now been slowed down with another powerful trend reversal candle pattern called "Dark Cloud Cover". This Dark Cloud Cover Candle pattern is top reversal powerful candle pattern.
If this Dark cloud Cover Candle pattern gets negated,then it means a this rally is very powerful indeed. Also this rally is going ahead on a rising volume. On monday longs should be careful and shorts also should be careful, since the BSE Sensex is still in the uptrend channel. As long as uptrend channel is intact the old longs are safe. If the weakness persists on higher levels, then lower side of the steep uptrend channel (10500-10700) may offer a good support level for fresh longs.
Short should only venture if the uptrend channel breaks-out or ruptures on downside with a volume.With strict stop loss.
BSE Sensex Daily Chart Highlighted Till 27/04/2009
Moving Averages
In the daily chart of BSE Sensex the last week all moving average from 13ema,34ema,50sma & 100sma were successfully crossed.The week of 20/04/2009 to 24/04/2009 proved to be giving tough resistance to 200 dma. But on 24/04/2009 last friday 200 dma has been crossed by BSE Sensex in daily chart..
BSE Sensex Daily Chart Till 27/04/2009
Structure Of Sensex
Since low of 7700 in November 2008, Higher tops & Higher bottoms structure was identified. Structurally from January 2009 again it has given way to Lower tops & Lower bottoms. Current BSE Sensex structure is (Higher Tops - Higher Bottoms, Lower tops - Lower bottoms). The range between 10200-10700 is good support zone for BSE Sensex on reaction to downside.
Momentum Indicator /Oscillator
Currently in the Daily chart the KST momentum indicator is in overbought zone, indicating a strong rally. As long as KST Indicator remains in overbought zone bulls can be comfortable.
Volume
The volumes From November 2008 to January 2009 indicated accumulation. This accumulation is being authenticated by this powerful rally starting from end of March 2009. On 10/02/2009 highest volume was seen.In April 2009 the rally has been on a rising volume which is good indicator that the this rally is a powerful one.
Trendline
Since high of 21206, in January 2008, a clear descending channel is seen in the above daily chart of the Sensex. BSE Sensex attempted breaking out on upside on 4 occassions, dated -16/05/2008, 12/08/2008, 05/09/2008, 12/02/2009. But on 16/03/2009 BSE Sensex did successfully crossovered the descending channel on the upside.
Retracement
Since the fall from high of 21237...January 2008,the retracements of 32%-13097, the 50%-10597 & 61.8% -8096 levels.
BSE Sensex on 6/03/2009 made a low of 8047, thus covering 61.8% of the total fall and on 08/04/2009 crossed 10597, thus covering 50% retracement of total fall.
Sensex Key Support Level-- ----10673, 10998,11211
Sensex Key Resistance Level--- 11367,11456,115021.
BSE Sensex Weekly Chart Till 27/04/2009
Currently in Weekly BSE Sensex Chart, on friday weekly closing has given a breakout of weekly descending channel.But this weekly breakout needs more confirmation in coming weeks.On further persistance of rally, the target of symmetrical triangle may become achievable.
So currently 11400-11500 is very crucial level for the BSE Sensex & breakout above the Weekly descending channel.
Old Overview of BSE Sensex Weekly Chart.
In the Above Sensex Weekly Chart from the high in January 2008, BSE Sensex has been trading in Weekly Descending channel. In October 2008 sensex broke out of descending channel signalling exhaustion and since then has been trading side ways below the descending Channel. This sideways trading has given to formation of symmetrical triangle.The symmetrical triangle often referred to as side-ways or consolidation pattern. It means before embarking upon any trend, it is breather period.The last week it was indicated that we will revisit the Symmetrical Triangle once again. Since Late february 2009-insert- bseseb 08/03/2009- it was indicative that BSE Sensex may give a down fall. Hence bearish scenario was taken into account.
Symmetrical triangle though are a continuation pattern usually. But sometimes Triangles may act as a reversal pattern also. As it is Triangles are one of the most trickiest patterns. Hence we revisit the pattern in BSE Sensex Weekly and have a re-look at our targets.
This weekly Triangle has given breakout downward at 9250. So now we will consider 9250 for calculations purpose.
The calculations is as follows:The base of the triangle is (High 11870-Low 7700) = 4170.
Upward target after Breakout will be (9250+4170) = 13420.
Again this target of 13420 can be said to be achievable provided the uptrend line of the weekly descending channel (as seen in the BSE Sensex Weekly Chart) is crossed by the BSE Sensex on the upside which is 11400-11500 currently.
Momentum Indicator /Oscillator
In the weekly chart momentum Indicator KST though in the oversold zone but have given bullish cross over and is going up to zeroline,indicating rise in upward momentum..
But still the intermediate tone can still said to be bearish in the BSE Sensex. Unless KST indicator gives breakout upside into overbought zone, intermediate bullishness cannot be affirmed.
BSE Sensex Monthly Chart Till 27/04/2009
The January 2009 and February 2009 Candle pattern was Bullish Engulfing Pattern.The March monthly Candle was bullish belt hold line candle pattern.In the BSE Sensex monthly chart the sensex has support at 100sma which is at 8155 & 50 sma is at 12176 . Also for the purpose of clarity we keep The Dynamic triangle-pattern on the backburner till April 2009 candle is taken into consideration.Unless 11400-11500 area is not crossed by BSE Sensex, the room for down fall remains. As has been indicated may times in all old BSE Sensex posts, that bull market or bull trend in BSE Sensex cannot said to be over for longterm till monthly uptrend line2 drawn from low of the year 1981 gets broken. And so far it does not appear to have broken. So long term BSE Sensex is still bullish.
Momentum Indicator /Oscillator
In the monthly BSE Sensex chart the Momentum Indicators or Oscillators KST is in over sold zone. KST Oscillator have not given any indication of forming any patterns or divergence. But possibilty of bullish crossing KST Indicator can be anticipated if upmarch of BSE Sensex continues.
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