Some Good Steals...
- Thread starter AMITBE
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... Warm Reagrds........Anand
Dear Amitbe,
Thanks for your reply on India Cements yesterday.
I have been noticing that the number of buyers far exceeds the number of sellers in the case of Nagarjuna Fertilizers, then why is the price not moving since the demand is more than the supply ?? Should that not happen ?? Just a newbie question.
Regards,
Karuna
Thanks for your reply on India Cements yesterday.
I have been noticing that the number of buyers far exceeds the number of sellers in the case of Nagarjuna Fertilizers, then why is the price not moving since the demand is more than the supply ?? Should that not happen ?? Just a newbie question.
Regards,
Karuna
Hi Karuna...It can be that a lot of people place orders at lower levels which gets reflected on your trading screen. If buy orders are more than sell, and the price does not move up, this is what I would read.
The volume is high, reflecting the buying interest at lower levels...this can also suggest accumulation. Basically it is a good investment scrip, few in the sector at this price. Should the results coming up next month show a turn around, there will be many many happy investors around.
With all the debate that goes on between Fundamental and Tech analysis, basically the price action on the charts would reflect the fundamental standing of a scrip at any given time. In case of NagarFert, it's progress on the price charts seems to reflect the showing past quarter.
Regards.
The volume is high, reflecting the buying interest at lower levels...this can also suggest accumulation. Basically it is a good investment scrip, few in the sector at this price. Should the results coming up next month show a turn around, there will be many many happy investors around.
With all the debate that goes on between Fundamental and Tech analysis, basically the price action on the charts would reflect the fundamental standing of a scrip at any given time. In case of NagarFert, it's progress on the price charts seems to reflect the showing past quarter.
Regards.
REI Agro is making a new breakout after several months of consolidation.
High Tech Gears can be a dark horse. 185 can be sticky so a little caution here.
REI is good and will make steady gains.
Good spurts in UCAL and Cen Enka are possible.
UCAL Fuel Systems CMP 270.75
CENTURY ENKA CMP 249.05
REI Agro Ltd CMP 188.60
High Tech Gears CMP 173.55
From the above calls this morning, REI closed 196.75, intra high 200.
CenEnka ended 254.90 intra high 258.
UCAL ended 279.95, intra high 282.
High Tech ended 182, intraday high 185.
During the day I had been referring to 'phases of a breakout' for the various scrips. I am bringing up a piece I had posted recently, in case it has been missed by any one as explanation:
Breakouts almost always occur at points of discord and divergence: levels of support and resistance. On either side of these levels, a lot of price action is generated, but no one is quite sure just how much force is required to carry price into a sustainable trend. Any position one takes near a breakout level comes with a fair deal of risk, regardless of how perfect a pattern may appear.
Price action responds in different ways to a breakout. First, it may carry through successfully to higher levels. Second, it may generate whipsaws (volatile and choppy price swings through support or resistance levels), resulting in losses on both sides of the market. Third, it may trap buyers in a false move and start a trend in the opposite direction.
It is believed by some technical analysts that a successful breakout occurs in three phases.
It begins when price breaks through resistance on increased volume. This is called the Action Phase. Price increases by a few points, and then reverses as soon as buying interest fades.
From here begins the Reaction Phase. The market will sell off, and propagate the first pullback, where fresh buyers see a chance to get in close to the breakout price. If everything goes well, a second rally kicks in and raises the price above the initial breakout high.
This marks the Resolution Phase where the price creates new highs.
For the three phases of a breakout to succeed, much depends on certain volume action:
Demand must exceed supply during the initial breakout. Volume should drop sharply during the pullback of the Reaction Phase. And finally, fresh buyers should come in to successfully trigger the Resolution Phase.
A false breakouts occurs when these forces fall out of balance.
Whipsaws will prevail when a breakout can't generate an efficient reaction phase. This failure need not necessarily trigger any major reversal, though the pullback will purge out weak hands and push the price back into resistance.
If there is a good number of buyers in the scrip throughout the choppy price action, they will repeatedly support the price, and as soon as the whipsaw fades out, the price stablises resulting in a loss of volatility.
A voluminous sideways movement in a tight price-band will then come into play, which itself acts as a trigger for a buy signal for the experienced traders. This would then start a bounce up in price to carry it beyond the last high.
Mainly then, once the first lot of buyers enter at the initial breakout point, much depends on the behaviour of the successive hoards of buyers.
A false breakout occurs when this second crowd fails to appear for any reason, whether its a failure to spot the breakout, or a disagreement with the price pattern. Without the support of fresh buyers, the scrip gets stranded in an overbought zone and falls from its own weight.
To extend this further, every new low will trigger s/l points, building momentum to the down, drawing with it new short-sell traders as more key supports are broken. Here a sharp reversal is now under way.
High Tech Gears can be a dark horse. 185 can be sticky so a little caution here.
REI is good and will make steady gains.
Good spurts in UCAL and Cen Enka are possible.
UCAL Fuel Systems CMP 270.75
CENTURY ENKA CMP 249.05
REI Agro Ltd CMP 188.60
High Tech Gears CMP 173.55
From the above calls this morning, REI closed 196.75, intra high 200.
CenEnka ended 254.90 intra high 258.
UCAL ended 279.95, intra high 282.
High Tech ended 182, intraday high 185.
During the day I had been referring to 'phases of a breakout' for the various scrips. I am bringing up a piece I had posted recently, in case it has been missed by any one as explanation:
Breakouts almost always occur at points of discord and divergence: levels of support and resistance. On either side of these levels, a lot of price action is generated, but no one is quite sure just how much force is required to carry price into a sustainable trend. Any position one takes near a breakout level comes with a fair deal of risk, regardless of how perfect a pattern may appear.
Price action responds in different ways to a breakout. First, it may carry through successfully to higher levels. Second, it may generate whipsaws (volatile and choppy price swings through support or resistance levels), resulting in losses on both sides of the market. Third, it may trap buyers in a false move and start a trend in the opposite direction.
It is believed by some technical analysts that a successful breakout occurs in three phases.
It begins when price breaks through resistance on increased volume. This is called the Action Phase. Price increases by a few points, and then reverses as soon as buying interest fades.
From here begins the Reaction Phase. The market will sell off, and propagate the first pullback, where fresh buyers see a chance to get in close to the breakout price. If everything goes well, a second rally kicks in and raises the price above the initial breakout high.
This marks the Resolution Phase where the price creates new highs.
For the three phases of a breakout to succeed, much depends on certain volume action:
Demand must exceed supply during the initial breakout. Volume should drop sharply during the pullback of the Reaction Phase. And finally, fresh buyers should come in to successfully trigger the Resolution Phase.
A false breakouts occurs when these forces fall out of balance.
Whipsaws will prevail when a breakout can't generate an efficient reaction phase. This failure need not necessarily trigger any major reversal, though the pullback will purge out weak hands and push the price back into resistance.
If there is a good number of buyers in the scrip throughout the choppy price action, they will repeatedly support the price, and as soon as the whipsaw fades out, the price stablises resulting in a loss of volatility.
A voluminous sideways movement in a tight price-band will then come into play, which itself acts as a trigger for a buy signal for the experienced traders. This would then start a bounce up in price to carry it beyond the last high.
Mainly then, once the first lot of buyers enter at the initial breakout point, much depends on the behaviour of the successive hoards of buyers.
A false breakout occurs when this second crowd fails to appear for any reason, whether its a failure to spot the breakout, or a disagreement with the price pattern. Without the support of fresh buyers, the scrip gets stranded in an overbought zone and falls from its own weight.
To extend this further, every new low will trigger s/l points, building momentum to the down, drawing with it new short-sell traders as more key supports are broken. Here a sharp reversal is now under way.
Hi Amit
Nice explanation of the breakout's.
Keeping all these points in mind how many points you will give to the breakout that occured in Ajant pharm on 1st sep. After that it pulled back on low volumes. Today was it's first up(not a big one) after the pullback.
Can it be entered here???
regards
Neeraj
Nice explanation of the breakout's.
Keeping all these points in mind how many points you will give to the breakout that occured in Ajant pharm on 1st sep. After that it pulled back on low volumes. Today was it's first up(not a big one) after the pullback.
Can it be entered here???
regards
Neeraj
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