Investor Choices

Savita Oil - Small Cap Company

2022-01-26T14:42:00.006+05:30

#techno_funda_analysis

Fundamental Analysis:

Following Table shows the performance of all three major department of the business like.

Marketing Department.
Finance Department
Operations department.

Let's more extend the marketing department performance as it is main department which generates revenue and responsible for any business profitability.

If we see fundamentally the company's marketing department has shown a phenomenal growth rate of 44% CAGR. which is a good sign.

Also EPS wise company has grown phenomenal rate. Earlier where they were generating 64 Rs. for every share now they can generate159 Rs. per share.

Altman Z-Score -4.70( Good For Solvency)
Piotroski F-Score - 7 ( Good for performance as compared to last year)
Modified C-Score - 4 (There might be a chance of accounting manipulation)

Technical Analysis:

Good time to consider the stock as an entry point as per technical analysis.

TANFAC Industries -SMALL CAP

2022-01-22T20:08:00.004+05:30

#techno_funda_analysis

Fundamental Analysis:

Following Table shows the performance of all three major department of the business like.

Marketing Department.
Finance Department
Operations department.

Let's more extend the marketing department performance as it is main department which generates revenue and responsible for any business profitability.

If we see fundamentally the company's marketing department has shown a phenomenal growth rate of 44% CAGR. which is a good sign.

Also EPS wise company has grown phenomenal rate. Earlier where they were generating 3 rs for every share now they can generate17 rs per share.

Altman Z-Score -14.53 ( Good For Solvency)
Piotroski F-Score - 6 ( Good for performance as compared to last year)
Modified C-Score - 0 (There is no accounting manipulation)

Technical Analysis:

Good time to consider the stock as an entry point as per technical analysis.

Can you invest Motilal Oswal right Now?

2021-07-03T19:31:00.004+05:30

Motilal Oswal

What fundamental says.?

If you see from past 5 years income is increasing. It has almost 3 times within 6 years.
EPS has also increased in FY-19 and FY- 20 it has decreased but this was the scenario of COVID where banks faced NPAs.
It generally trade at the average PE of around 25 times. Currently it is trading at the PE of 10 times.
Institutions are also increase their buying.

What technical says.?

Monthly chart

Weekly chart

Volume Profile

Profitable Candlestick Trading

2021-06-20T10:38:00.003+05:30

PROFITABLE CANDLESTIC TRADING

One of the best book to understand candlesticks trading. Free PDF reading.

HDFC AMC- Observation

2021-05-28T19:48:00.005+05:30

Swing Trade.

Lets Look at the HDFC AMC chart and try to analyze its behavior. We will apply here 2 ways analysis means on one side we will look for price action and on second side we will look for indicators.

Price Action:

If we see the line chart there is "Flag and Pennant" pattern one of the most powerful pattern in technical analysis. We can see that price exactly respect the 50 Fibonacci ratio which is a very good ratio (where pullbacks are retested) and move.

If you see it gave good a breakout of pennant pattern with good volume.

Now let us switch to candlesticks to get more 3D kind of view.

What indicator tells?

If you see the chart here you will find that there was squeeze and it broke out that means its volatility is increasing. Also if you see that there is RSI above 60 which indicates the momentum or speed. Also there is MACD crossover which also generates a buy signal. So from both of the side stock is looking nice for swing trading.

Target

Now the question is how do we decide the targets.

So if you se the above image you will find that it takes the stock 112 days to form that pole and total move is 1272 Rs. So theoretically it gives the same return 1272 Rs within half of the time 56 days. see the image bellow.

Target: 3,970

Stop Loss: 2,800

CMP : 2,976

Risk to Reward. 1:5

IOC Chart Observation

2021-05-26T01:18:00.004+05:30

CUP Pattern (4 Months)

Conditions:

1. Pattern must be at least 6 to 8 weeks.

2. There should be great volume on right side of the pattern.

3. May re-test or not the neckline. In this case it has tested.

4. Target should be around the depth of the CUP.

5. Stop loss should be bellow the Re-tested Zone.

Additional Check.

1. RSI above 60. There is momentum in the price.

2. BB% greater than 70 there is volatility in the chart.

Target - 121

Stop Loss - 103

Risk to Reward 1.5

Note: This is for knowledge purpose only.

Buyable Gap Up

2021-05-23T15:18:00.003+05:30

How to Trade or Invest using GAPS?

Most scary thing in the world of 'stock market' is 'gaps-up'. it becomes very difficult to manage trade when security opens 'Gap-up'. So what is the right way to trade gaps or take position on the basis of gaps.

There are three rules that must be check before trading gap-up market.

1. ATR : Check 40 period ATR before gap-up. The price move must be at least 75% of that value.

2. Volume : Volume must be 150% of 50 DMA volume.

This Gap-up must be occur in constructive consolidation or an uptrend.

Let's look at the chart and understand.

Let's look at the chart.

There is a Gap-up

40 period ATR before Gap-up was 111.89. Price should Gap-up at least 75% of ATR that means 83.91. We can see price Gapped-up 245 (i.e. 32,450 - 32,205)

Volume is 150% or 3 times. 50 SMA Volume is 162.40K and Gapped-up volume is 527.42K

All three conditions are meeting the criteria. Now where to entry and what should be your stop loss is clearly mentioned on chart. Trail you stop loss when you are in the favour.

M&M finance Observation

2021-05-22T22:32:00.006+05:30

Swing Trade

Lets Look at the M&M finance and try to analyze its behavior. We will apply here Top -Down means we are going to analyze from higher time frame to lower time frame.

1 Month Time frame

Look at this 1 months chart. Here we can see that there was 3 wave pattern which was ended by making the TOP of 224.30 after that stock went into correction mode and came near to the low 149.60 but did not break it and start turning up.

Weekly Time Frame

Now move to one time frame lower and try to analyze weekly time frame what it is doing. Here we can see a beautiful compression pattern that means if you will see back you will find that it took him 2 weekly candle a fast move to make that high of 224.30 with good volume. But when price came back to the same level volume was drying and took more than 10 candle to cover full move. And now it is making support at 40 RSI. and also 50 SMA. Which is a good sign.

Daily Time Frame

Now move to one day time frame. Here we can see stock gave a good consolidated break out from the zone with the signature of volume.

Entry : Above 163

Target : Around 180-186 (Resistance Level)

Stop Loss : 150

Risk to Reward. 1.5

Master Swing Trader (Toolkit)

2021-05-22T18:37:00.000+05:30

Get an edge in your 'Trading' and timing the 'Entry' and 'Exit Points. Free reading PDF.

Bank Nifty- Observation

2021-05-22T17:44:00.003+05:30

Bank Nifty ( Head and shoulder Pattern)

A very nice head and shoulder pattern has given a breakout on Friday in BankNifty on 1hourly time frame we can see it very nicely.

Now as per the rule it provides target as equal to the depth of the head and neckline. Which is almost 10% so we can expect a 10% upward move in Bank Nifty.

There might be two consequences:

1. It may directly go towards target where it will be difficult to manage risk( so it is advisable if market open high on Monday avoid the entry)

2. If market pull backs toward neckline of the head and shoulder so that will be nice trade we can enter if it makes support and suits our risk parameter.

Thank you.

PNC Infratech ltd.

2021-05-08T21:53:00.000+05:30

1. Very nice broadening pattern.

2. A nice breakout from weekly levels and a nice pullback as well.

3. RSI above 60 on monthly.

4. Good fundamental stock.

5. Good management.

6. FIIs increasing the stake.

Chart Pattern (Technical Analysis)

2021-05-02T11:53:00.003+05:30

Silver observation - Pole And Pennant Pattern

Silver might be a good investment . Wait for the right opportunity .

1. Pole and pennant pattern .

2. RSI comes to 50 at first time from 80 RSI and goes sideways between 60 and 50 RSI .

CONFIRMATION 1. When RSI will close above 60 and % B will Also close above 1.

DOUBLE CONFIRMATION . When Pennant pattern will break . Target would be length of the pole make sure to put STOPS as well

Dabur India (Chart Analysis)

2021-04-21T18:07:00.002+05:30

1. Here we can see a nice pattern of straight top and rising bottom. Generally if these kind of patterns are form than it is good chance that stock could achieve the target of width of the triangle.

2. Stock is in good momentum as we can see RSI is above 60 of monthly, weekly and Daily.

3. Moreover there is squeeze break out this means it has increased its volatility.

4. Stock falls under the sector FMCG

COVID Proof Investment !

2021-04-19T20:58:00.001+05:30

NIFTY FMCG OBSERVATIONS

Here we do NIFTY_FMCG analysis it is the safest sector for investment right now . Reasons : 1. It is a defensive sector and consumer need based sector . 2. Debt is low as compare to other industries so there is no harm of fixed interest cost . 3. Last time during pandemic it was the first sector which recovered in v - shape . 4. Broadening pattern it has completed its 5 touches if it takes support near support zone highlighted in the chart . It will bounce like a It has been consolidated for long time also . Thanks

Chart Patterns (Technical Analysis)

2021-04-18T13:12:00.000+05:30

BROADENING WEDGES

Let’s understand broadening wedge pattern. It is a pattern where trend channel narrow at beginning and keeps broadening. We can have upward or downward breakout. But here we can see that it has already touched its 3 points on upper trend line and there is strong support near 32,100 so we are required a partial decline. Which will be around 32100 and if it takes support near that zone than we can have an upward breakout and we can achieve 32,800 level. Let’s watch. Thank you !

Chart Patterns (Technical Analysis)

2021-04-17T23:35:00.001+05:30

BROADENING BOTTOMS

Broadening bottom live example. Two higher highs and two lower low is required for broadening bottom. 3rd high will retrace little and break that resistance line. Take the trade
#stockmarketindia #technicalanalysis #trading #nseindia#autoindustry
For educational purpose

Chart patterns (Technical Analysis)

2021-04-17T23:18:00.002+05:30

BROADENING FORMATIONS, RIGHT - ANGLED AND ASCENDING

Hi Investors there is " Broadening Formations , Right - Angled and Ascending " found in NIFTY IT . As per this formation there will be horizontal support and a ascending resistance line. Mostly breakout will be provided on downside . One partial decline is required which is almost done done it has touched its Fibonacci 50 % level you can avoid IT stock as it is short term bearish reversal sign . There will be good buy again in IT near 2430. thank yoU

Accumulation VS Distribution Phase

2020-12-04T12:47:00.004+05:30

How to know if the stock of a company is in 'Accumulation Phase' or Distribution Phase'?

This is a very common question every investor asks before an investment in value stocks. Sometimes what we see is stock, take the move and go sideways so it becomes difficult for an investor to identify whether this sideways phase is for accumulation or distribution and how we should understand this?

Here is the simple trick with the help of which you can easily identify the stock phase.

There are three major players (Smart Money) which play an important role in shareholding of any company.

a) Promoter.

b) Mutual fund or Insurance companies.

c) FIIs (Foreign Institutional Investors)

So let us understand how we will identify smartly which company is good for investment.

Step 1:

Find a good fundamental company.( Smartly)

a. Sales must be increasing.

b. EPS should be increasing.

c. Low debt.

d. P/E should be less than industry.

eg. KEC intnl.

Step 2:

Look for past 6 months' shareholding of 'Smart Money'. It should be increasing, you may look this from any website like Ticker Tape, Market Mojo, Screener.in etc. which you find comfortable.

Step 3:

Look for a technical chart. This increasing stake should not reflect in price. . In the following chart you can clearly see smart money holding was increasing, the Company was growing in terms of sales and EPS. Still price were going down, this is a perfect example of smart money

If all conditions met, good to go.!

Disclosure: This is not a stock recommendation. It is a back test You should try to do more test on different companies to get confidence on it.

Happy Investing Good Luck !

Trading in Zones (Multiple Time Frame Analysis)

2020-11-10T13:28:00.006+05:30

How To Trade Demand/Supply Zone??

"MULTIPLE TIME FRAME ANALYSIS"

Step One.

Find the Supply/Demand Zone: This is the zone from where the price has been departured too far.

Time frame 5 min

Step Two

Go to 5 or 6 times Lower Time Frame 1 min in this scenario as the above chart is for 5 mins.

Step Three:

Find the *reversal candlestick* pattern only on a lower time frame and Supply/Demand Zone whatever the case may be.

*Hammer

*Doji

*Piercing.

*Engulfing

*Tweezer Top/Bottom.

Note: Remember these patterns are only useful and effective in Zones.

Take the trade with proper SL

R: R must be at least 1:2

Trading is a combinations of Zones, Candlesticks patterns and indicators.

Rules to remember:

1. When trade zones never trade only one time frame. Otherwise you will not get better risk and reward. Moreover you may missed the trade because lower time frame change earlier than higher time frame.

2. Trade only those reversal candlestick patterns which are formed in zones. These are much effective.

3. If lower time frame approaches the zone but do not show any reversal candlestick pattern zone may break. Never trade on that zone.

4. Difference between Higher and Lower time frame must be around 5 - 6 Times not more or less than that.

Good Luck ! Happy Trading...

Emotions Vs. Logic Stock Market Trading.

2020-08-22T13:02:00.006+05:30

Why do most of the traders fail to make money? Can a 12th pass candidate earns millions from the stock market...

Emotions play a very crucial role in trading in the stock market. I have observed that many times a well educated person (i.e. Technical Analyst) fails to make money and a common person who knows nothing about it but basics does wonder.

How does it happen?

See, Stock Market is filled with the numerous of brains which comprises of several major emotions which every human being does carry i.e. Fear, Greed, Anger and Hope. And these emotions have no link with the education qualification of any person. A highly graduated masters degree holder or a normal graduated person both can have these emotions. Major winner will always be the person who will manage their emotions, not the one who is more qualified.

Briefly understand how the market works,

Whether you agree or not but it is true, Market is moved by market makers (20% people have large chunks of money) who have monopoly. They can move the price up or down as per their own will and interesting thing is that they don't trade themselves i.e they use algo systems to trade which has no emotions but only logic and that is "Buy Cheap Sell Dear".

Here are some emotions which I observed myself and by talking with different traders when they get success and failures in trades. Surely, it will help you to understand your emotions which can lead your trading better.

Emotions And Trade

1. Fear with greed ( LOSS ) - Fear of missing opportunity

2. Fear with confidence. ( SUCCESS ) - Price showing exit but logics are still in favor.

*Confidence comes with logic.*

3. Hope with confidence. ( LOSS )- logically exit but there is a hope that price will go up.

4. Hope with fear. ( SUCCESS ) - No analysis but there is a hope that the price will go up still a fear.

5. Greed with hope. ( LOSS ) - No analysi but there is a greed that price will go up and hopping should go up.

Bonus Rule

Don't trade if you are forced to take trade. There will be a loss.

If you find the article interesting don't forget to subscribe to the blog so that you never miss any future updates.

Bitter Truth Of Stock Market

2020-08-15T22:11:00.004+05:30

Truth behind trading in the stock market.

There are a lot of advisors in the stock market (i.e. so called 'Technical Analyst') who keep predicting levels of the security weather it is a 'Stock' ( e.g. Reliance, Tata motors, Cipla etc.) or an 'Index' (e.g. Nifty, Bank Nifty etc..) with so much of conviction that you can't stop yourself besides believing to those.

My first question is how can you predict the price?

There are not only a few people who are making the price but billions of people's minds

are working behind the price movement. How can you read those minds?

Anyhow they start predicting with daily price levels, weekly price levels, monthly price levels and so on. Which is leading to people a tendency of speculation.

Just try to understand what happens in the stock market.

These people predict the price with so much of conviction that you have no other choice but to believe them. When the price goes up they come up as a 'HERO' . Hey ! look what i said price will go up and see what has happened, but if price does not move as per their prediction they will stand up as an 'innocent kid' who has a lot of excuses like.global selling pressure, Indian negative news, profit booking, global negative news and so on. They have thousands of excuses with them that you can not argue with them.

What I believe ! ( May be wrong)

No one can predict the price because it is not formed by a few people but billions of brains are working behind that hence you can not predict those brains. See you can only comment after the move let say, if price goes up you can comment it may be because of this news if price moves down you can comment it may be because of that news. But the truth is 'price has moved' either up or down rest is assumptions.

What you can do is ? You can just analyse what those brains are doing that's it !

And on the basis of that analysis you can take a trade. Stop assuming all the time the market will move up or the market will go down but look exactly what the market is doing right now. Make it simple and easy don't try to make it complex that price is moving down so it is fake, price is going up so it is fake forget all just look at the price and act accordingly. Trading is a professional business. Stop putting your hard earned money on the basis of illogical talks .

Now you might be thinking how will you come to know what the market is doing?

Well ! it's all part of fundamental as well as technical analysis you must have to educated yourself besides that you act on an illogical calls of so called 'Technical Analyst' who are predicting the market levels.

Trading with insiders not with masses

2020-08-04T18:24:00.000+05:30

Why do retail investors always suffer with losses? Are "Institutional Investors" the only one who has the right to make money?

These types of so many questions I was asking to myself and when you ask questions there is an answer. I was reading a very nice book where a concept of 80/20 pareto principle was nicely explained. I would like to summarize the whole book concept and betting that it will definitely help you provide an edge in investing.

Firstly, I would like to brief you about Pareto principles. What does it say? This is the principle of "Vital Few" which says 80% consequences come from 20% causes. It applies everywhere. Firstly, it is observed in 'ITALY' where 80% of land was occupied by 20% of the population. Another observation is that 20% is the conclusion of the whole book, 20% of your clothes you wear 80% of the time. Remember it is not a thumb rule but is just an observation and this simple observation works wonders in the 'Stock Market' let us understand how?

Firstly, Tell me if you are doing a business then who knows your business better? I mean what you are going to earn, who knows it better, you, your neighbour or any other person who is closely watching your business. Of Course it is the only you !

Tell me a thing why does this happen that you buy a stock and it falls down, you add more and it falls more why why why?

Here comes the role of insiders into the picture. Let us understand.

For example there is a stock which has fallen more than your expectation and you think it is now cheap to invest you invest it falls more everywhere there is something bad about the stock every newspaper, every news channel every journal article tells how much the company is bad. But 'Insiders' are buying aggressively, they are the few who are against the masses. It is a sign that stock is forming a bottom. And again if everyone is talking good about the company and 'Insiders' are getting out of the stock it clearly shows the sign that it is near the bottom.

Crux of the whole article is that you must watch the 'Insiders' activity before investing in those stocks which are in the limelight today.

Economic indicators and their impact on stocks !

2020-07-12T13:08:00.000+05:30

Economic Analysis

Economic Analysis is the primary term or factor which is used before any kind of investment. It stands first in top-down approach i.e EIC (Economy | Industry | Company )

So it should not be ignored as it plays a vital role to impact the stocks and their performance. There are few indicators which tell us about the economic condition, what is going into the economy and how they impact the business.

These indicators can be found easily on google on different websites. One and popular website for these information is Trading Economics.

Caution: The accompanying chart merely serves as a handy guide and should not be construed as an accurate predictor in all cases. Many times the anticipation of good or bad news is built into the market and when the news comes out, the reverse move happens.

Investor Choices

Book value, Face value and Market value of a share

2020-07-07T14:46:00.001+05:30

Difference between face value, book value and market value.

Let us understand these all terms with an example of a story so that you never face any problem regarding these terms in future.

There are three friends A, B and C. They start a new business with the capital of 10 lakhs. In which A contributes the capital of 5 lakhs, B contributes the capital of 3 Lakhs and C contributes the capital of 2 lakhs.

They think that they might have faced problems of capital transfer and distribution in the near future if they were required to add another person in the business. So they divided their capital into 1 lakh shares of 10 rs each. So this 10 rs is called face value which is their initial investment.

Now they continue the business and next year they earn the profit of 10% in their capital. They want to grow their business so they don't withdraw completely but 50% of their profits. Hence next year their capital becomes 10 lakhs plus 50 thousands profits.They continue doing this for 5 years . After 5 years by doing this their capital becomes double i.e 20 lakh in the book. Now their value in the book is 20 rs per share. This 20 rs per share is called book value.

Now they wanted to expand their business outside the country or within the country but different states for this purpose they are required funding. They approach investors with an IPO that is my book value we have worked hard and doubled our money with in 5 years you gave us money we will do business from your money and will double it with in 5 year but for this purpose we will charge premium so they decide a price band let say 25 rs - 30 rs now investor starts bidding within the band and company got listed with the price assuming 28 rs based on demand and supply so this 28 rs is called market price.

EIC Analysis or Top-Down Approach

2020-07-01T22:34:00.006+05:30

Basics of Top-Down Approach (EIC Analysis)

Basics of EIC Analysis which will be helpful for a common man to understand. How to design a portfolio. An optimum portfolio is that which grows faster than the economy when the economy expands and falls less as compared to the economy when the economy contracts.

1) Economics Analysis: Basically economic work in the cycle. Which has two phase expansion and contraction we can simply identify the phase by observing our surroundings. Let's say, if we hear GDP is growing, more employment opportunities are being created, Infrastructure improving, MNCs are investing etc. these are the examples of expansion economy and contraction is vice versa.

2) Industry Analysis: After analysing the economy we need to pick those industries which perform as per the economy cycle. Industries are classified as per their nature how they perform as per the phase of economic cycle.

3) Company analysis: It is much easier to identify a company which will be good for investment. We just have to be aware about our surroundings whatever product you use just look at its back which brand it is. By continually seeing the one brand again and again you will be sure that the company has a good product portfolio which is very helpful for top line i.e sales.

Investor Choices