BraViSa TempleTree-India Market Calls

[d_s_ramesh]

Bearishness getting stronger.

Fourth consecutive day of lower lows on NIFTY. 4950 likely target in the current bear move. Before that there can be some pull back to value. Hourly charts have retraced bullish divergence on both MACD lines and MACD histogram. There is a likely up move in the next session.

Hourly charts have a possibility of trading long, reach 5200 levels and then resume the move towards 4950. Hourly close above 5132 will give signal to trade long on the hourly chart.

HEALTHCARE is the only sector to close positive today. CIPLA, LUPIN, GLAXO and PIRAMAL have had big gains in a falling market. TELECOM being the weakest followed by CONSUMER SERVICES, TECHNOLOGY and BASIC MATERIALS.

Both Telecom Services and Telecom Equipments were big losers today. Pig Iron and Sponge Iron industry had an above 4% fall for the second day, JINDAL Steel hits strong bearishness. Electrical Equipments followed with a close to 3% fall, ABB leads down. Packaging Industry saw an above 3% gains followed by Paper industry which has gained 2.50%, all three BALLARPUR, TNPL and WEST COAST give robust gains.
Stock calls for today.

Shorts

ASIAN PAINT, below 2012 with a stop of 2075.
HDFC, below 2720.30 with a stop of 2811.50.

 

[d_s_ramesh]

Poised to reach 4950 and beyond.

NIFTY gave a fifth consecutive lower low and a lower close. It fell a shade low of 4950 support. Daily charts have gained into a clear bearish trend. Value zone for today is at 5183, one may look to short on a down tick after NIFTY reaches value zone for a target 4950 and beyond. Continued global weakness assures neat profit on the short trades.

Hourly charts have retraced good bullish divergence on both MACD lines and MACD Histogram. There would either be a sideways pattern or a bull move to close to daily value zone of 5185.

The bear onslaught of the past week bears its brunt the most on the basic materials Sector. BASIC MATERIALS has witnessed close to a 10% fall in its index value. There are 4 Industry groups which have registered double digit weakness, above 10%. Two of the double digit losers, viz., Pig and Sponge Iron Industry and Mining Minerals Industry come into the BASIC INDUSTRIES Sector. Hence this major fall in this index. JINDAL STEEL and STERLITE have lost more than 10% in a single week.

The bull move which took 3 months has been lost in 1 week. This is the power of the bears. Bulls climb by the stairs, while bears jump out of the window. This adage proves true every time there is a bear market.

INDUSTRIALS Sector followed the weakness with a 7.5% fall on its Index. ABB which came to sell last week at 774 levels has gained more than 100 points on its short position with its closing price on Friday.

HEALTHCARE and ENERGY Sectors though were losers, have managed with a less than 1% fall on their respective Indices. A correction on Crude prices has reflected well for the refiners, combined with this was the Supreme Court ruling on RELIANCE, which closed positive. All the refining stocks have
registered good gains. BPCL, HINDPETRO and the likes in our recommendation have done well.

Why is HEALTHCARE doing well? It is this Sector that bruises the wounds. It is cyclic, that in a recession the only Sector to keep its head above water will be HEALTHCARE. This will be followed by CONSUMER GOODS Sector.

CONSUMER GOODS Sector stayed 3rd from top this week confirming the cyclic pattern. Auto Cars and Jeeps has recorded below 1% fall followed by Breweries and Cigarettes with a lesser degree of weakness compared to their counterparts in this sector. Are all the market men having a ball in the bars? Market is weak and traders are rejoicing the multifold gains they made in the past year by partying. This is great news.

This is the power of broad based analysis; it shows the picture of the economy like a movie. The weakest Industry groups for this week are, Sponge Iron, Civil Construction, Plastic and Non-Ferrous Metals. Why is Plastic Industry taking the back seat while Crude Prices are falling? RELIANCE is holding supplies of raw materials for the past 3 weeks creating artificial demand in the market. This is one of the unethical business practices of RELIANCE. Though they make money for their shareholders by manipulating prices. It is not going to stay for long. When any business considers the CUSTOMER AS KING, our frontrunner on the stock market RELIANCE treats them as slaves. Very soon RELIANCE is likely to pay for its unethical business practices. Scarcity for raw materials in the market has hit production of many manufacturers, this adds to an already weak market demand.

This weeks stock calls. Short calls take the lead.

Short

Weekly positions

ACC, below 852, stop 926.
ICICIBANK, below 869, stop 979.80.
IDFC, below 152.50, stop 173.60.
JINDALSTEL, below625.25, stop 753.90.
SAIL, below 201.30, stop 228.60.
SUNPHARMA, below 1516, stop 1690.
TATASTEEL, below 552.45, stop 664.70.
WIPRO, below 631.00, stop 705.00.
HINDPETRO, below 313, stop 347.20.
MUNDRAPORT, below 645.00, stop 768.90.
OFSS, below 2025, stop 2235.10.
SESAGOA, below 368.00, stop 448.40.

Daily Shorts

AXIS, below 1182.20, stop 1251.60.
BANKINDIA, below 343.10, stop 375.50.
FEDBANK, below 276.90, stop 299.05.

Daily Long.

HCLTECH, above 395, stop 388.95.
SBIN, 2292.80, stop 2213.25.
ADANIENT, above563.50, stop 558.80
CANBK, above 436.50, stop 399.95.
INDHOTEL, above 108.15, stop 102.45.

We have herewith given all the signals that come in the NIFTY and NIFTY Jr. Index stocks. These are to be traded on the futures only, as shorts are not permitted on cash market. Hence keep sufficient capital to risk on the stocks. Do not hold more than six open positions at any given time.

Review the stocks using your own scanning methodology; select the best according to your trading psychology and risk apatite and trade accordingly. There are few long calls in the bear market, these are risky bets. If market turns around from here, these stocks would be the leaders.

Trading is a probability game, we have given the high probable selection here, use your judgment and the market moves in your favor. Happy trading.

 

[d_s_ramesh]

Strong pull back

Governments step in for a bail out package for the European crisis, market take to a strong U turn. NIFTY has pulled back to value zone gaining more than 3% on its value in a single session. Daily charts do not suggest long trades here, but, there is a clear warning of non-trend in the markets.

This type of knee jerk reaction will take a long time to settle down. There is a likeliness of a prolonged sideways pattern on the daily charts. As the range has widened beyond normal comparison, there are a lot of opportunities in the short term charts. Hourly charts are likely to give trades on a retracement to value.

Most of our long signals on the daily timeframe have been filled. CANBK holds the same entry levels. FEBBANK goes out of short signal. Hold to stops on other positions.

 

[d_s_ramesh]

Non-Trending Market

NIFTY on the daily chart was in non-trend; todays indecisive move on the index has rendered the hourly charts too in the non-trend zone. Until NIFTY settles down and breaks out there is no point in trading NIFTY. Traders with deep pockets may venture to test the trend, please maintain very low risk.

There are very low volumes on almost all the indices and that is the reason the market is swinging on the either side everyday. Smart money is off the market on a brief holiday.

All the SECTORS closed weak today, the leader on the fall was TELECOM followed by UTILITIES and then with BASIC MATERIALS. There are still few bullish Industry groups which have the potential for some long trades. Some of them are Leather Products, Cement, Cement products, Pesticides and Agro chemicals, Cycles, Tires and Lubricants, Leasing and Hire purchase.

Identify the outperforming stocks of these indices, wait for them to retrace to value, and then give an uptick, only then trade long. Caution is needed on long trades now as the broad market is weak and non-trending.

 

[d_s_ramesh]

NIFTY, coiling in Range.

NIFTY continued its non-trending move with a narrow range. Intraday moves showed shrinking of the range pattern. Though previous low was breached, there was not much strength to drift down; it pulled up to close positive.

A down side breakout and a bullish divergence is needed for any bullishness to return on the index. A move past previous weeks low of 4985 would turn the weekly into bearish trend. As of now only the weekly charts shows trendiness. 5200 would act as strong resistance on any move up from here.

On reaching 5200 hourly charts would retrace bearish divergence and resume the bear move from there.

While most of the Sectors closed positive today, TELECOM took to a large amount of weakness. The Index has lost more than 2% today, followed by INDUSTRIALS closing marginally weak. Telecom Services Industry took a larger plunge with an above 6% loss on its index value. Index leader BHARTI has given a new low today. IDEA also has closed largely weak today; both these front runners have lost more than 8% to their previous closing price.

CONSUMER SERVICES Sector topped the gainers today, Media and Hotels Industry groups shined in a volatile trading day. INDHOTELS is doing strong runs from the recommended 108.50 long entry.

 

[d_s_ramesh]

Dancing NIFTY

Markets today took another tight rope walk, as indicated it faced stiff resistance at 5200. The Index managed to close positive into the SWEET zone between both EMAs. Daily charts are going into a tight weave of prices. What is the direction, will it go up or down??? Probably up, but downside has more prominence.

Hourly charts have shown trendiness from the 2nd bar today. We use a system to rate the trend and signal to trade the indices. Our rating system has given a buy signal on the closing bar of the day. We do not boast of a system which is 90% accurate, but have a very strong real time experience of making above average gains in the long run by using this system.

As per our system hourly chart is in buy signal above 5182.10 on NIFTY (Spot), the values of NIFTY Future are 5183.30. Our system rates the combined trendiness of the constituent stocks and gives signals to either trade short or long only if more than 50% of the stocks in the constituent list is trending. Along with this a few proprietary indicators are used to find the signals.

This is a trailing system with stop-and-reverse mechanism, and hence needs signal rating analysis for every bar. We will make it a point to update the signals every hour or at the most when the signal changes. The stop loss for this trade is 5157, which is slightly below the slow EMA.

Almost all the Sectors registered gains today except for TELECOM, which has given back 0.30% on its Index. BHARTI & TATACOM have given new lows again. Short trade in BHARTI has gained further momentum. Every stock in this Industry group is strongly bearish, except for TULIP.

The top gaining Sector today was FINANCIAL with a 2.12% gain followed by CONSUMER SERVICES with an above 2.06% gains. Leasing Hire purchase and Equity Investments Industry were the stars in the FINANCIAL Sector. Diamond and Media Industry groups performed strong in the CONSUMER SERVICES Sector. ZEEL has gone neutral after the strong recovery it has made from the current bear move; this has lifted gains in the Media Industry. TITAN has given a new high today adding more strength to the already strong Industry chart.

 

[d_s_ramesh]

Long above first bar high.

Nifty futures long above 1st bar high 5178.90, maintain stop at 54 points below entry.

Hold position in long, 2nd bar continues the long trend.

 

[d_s_ramesh]

short

Trade reversed, trending market. Short below 5158 spot, stop 5203.

 

[d_s_ramesh]

Shorts doing well

Short trade going in sync, hold with stop. There are no fixed targets, we hold till trend changes direction or goes neutral.

 

[d_s_ramesh]

A different story at each level.

There is a peculiar pattern formed this week with the different timeframes in NIFTY chart. Weekly chart has pulled up from weakness and shows signs to a continuation of bullish trend. Daily charts are neutral while the Hourly chart is bearish. This makes the alarm ring loud, The Markets at present is not a sweet game, be watchful, to support this we find drifting volumes every day. A clear indication that the smart money has gone out on a fishing expedition.

Those who are fighting it out here on the volatile arena are the averages who want to grab of some left over. While we found this pattern, we took a different study to find how the stocks are stacking themselves in the trendiness. There we got a better confirmation.

On the Weekly charts, 21 stocks are on the bullish trend, 12 stocks in the bear trend and 17 stocks on the sideways. This shows that the weekly trend is bullish or at the most to continue with bullishness for some more time.

On the Daily charts, 18 stocks are bullish, 5 stocks are bearish while a major chunk of 27 stocks are neutral. This coincides with the sideways pattern that the index is now. Stock list which we used for this is the NIFTY Index stocks.

We started giving the intraday calls of our system from Friday last. Our first trade though was a Whipsaw losing 30 points while the next short trade is reaping it rich by being positive by more than 80 points at the time of market close. The weakness is likely to continue further. Hold to short position till we give the exit call. If the market is in trend on the Hourly charts, there will likely be a reversal trade on exit.

We do not predict to have a 80% or 90% winning trading system, this is a probability game. There can be a losing stretch running of more than 7 trades too, and vice versa, but trading with discipline we can surely reap rich rewards. We will continue to post our calls as it happens to come. There is no bias, just following a simple trading system.

The Sector performance for the week is again a different picture with most of the sectors closing in green. The exceptions were ENERGY and BASIC MATERIALS Sectors which have closed weaker just short of a percent. While TELECOM Sector gave back close to 3%, the weakness of this sector was strewn all over its Index with all the stocks in this list, BHARTI, IDEA, RCOM, MTNL & TATACOM etc., most of them have given new lows.

The bearish trend in the TELECOM Sector is likely to continue further. On the winning side it was CONSUMER SERVICES & FINANCIAL Sectors that have closed positive by more than 2%. All the Industry groups in the CONSUMER SERVICES Sector have given robust gains with Hotels leading the pack by more than 6% gains followed by DIAMOND Industry gaining close to 5%.

In the FINANCIAL Sector it was the super strong performance of Term lending and Equity Investment Industry with more than 6% gains followed by Private Banks Industry which has closed with an above 5% gains that has pulled the Sector strongly up.

The strongest Industry groups in trend this week are Diamond, Leasing & Hire Purchase, Pesticides and agrochemicals, Paper & Leather Products Industry groups.

Many of our weekly calls of the past week were not filled, of that some got a new entry and many are off the signal. The list for this week is as follows.

Short Trades

SAIL, below 207.10 stop 222.50.
AMBUJACEM, below 104.55 stop 121.50.
BHEL, below 2351 stop 2413.
CIPLA, below 309.80 stop 330.
HINDUNILVR, below 231.35 stop 258.
JINDALSTL, below 648 stop 687.50.

Hold stop for TATASTEEL which was filled short on Friday.

Happy trading.