Reliance Industries - Unshackling Story might begin soon

Reliance Industries - The big name in last bull rally of 2004-2008. This is a big name in Indian Business Industry.

This share was discussed earlier in the blog as well. We discussed its consolodation then as well then the share was near support and now it has reached the upper end. Can it will break the shackles this time. Lets wait and watch.

Breaking above this trend-line would be a great opportunity to long in this counter. It can easily test 1600 level in 6-12 months.

The new buys can be initiated on breakout or on retesting of low again who are already holding from previous post : Hero of 2007 - Reliance Industries


NOTE: Above charts are shared only for learning purpose and is not related to any BUY/SELL tips.

USDINR and Nifty Updates

Some serious correction seen in the market and USDINR finally gave a breakout which we were discussing from past so many weeks. Let see how the charts looks now:

USDINR:

  Dollar gave Breakout of Inverse head and Shoulders. Staying above 67 now take Dollar to new highs. We might see all time high soon on the cards.

NIFTY:

Nifty currently trading in down trend channel. Inside channel has support at 7380-7400 levels while larger channel has support at 7300 levels. 7200 is major major support beyond which if Nifty trades then something seriously wrong with Indian Economy.

Lets See how it goes.

NOTE: Above charts are shared for Learning purpose only and are not related to any buy sell TIP.

Market Updates

Market corrected somewhat in previous week and USDINR showed some strength respecting the behaviour which we discussed last week.

Lets Analyze the market movement in coming week as what charts have to say:

Bank Nifty:

Bank Nifty is near crucial support. If holds then a pullback can be seen to sub 17400 levels otherwise big downmove knocking on the door. 

USDINR:

  Bullish pattern still intact. Be cautious for any follow up move above 66.92 levels.

NOTE: Above charts are shared only for Learning purpose. These are not related to any BUY/SELL tips.

 

Nifty and USDINR Correlation , Vascon Engineer [Cup n Handle]

Some good moves seen in current expiry where in Nifty is trying to recover after a good fall and INR also showing some respite against Dollar. In India, the currency comparison is generally done along with Nifty movement. Lets discuss today how these two things are related.

Nifty Vs USDINR:

The above chart is comparison of Nifty and USDINR charts. From the charts, it can be clearly seen that both are complementing each other. Whenever, USDINR makes an intermediate high the Nifty makes intermediate low and it does not matter what is long term trend of both. 

The left part of comparison is when Nifty was in up-trend while Right side of comparison is when Nifty is in down-trend. 

At current point of time, a simultaneous spike seen in both in short term. What will happen , it will be interesting to see :-).

Now lets see how individual charts are shaping to understand some new learnings :

NIFTY:

  Nifty is ideally trading in big down trend channel from sub 9100 levels. In last few months, great recovery is seen in Nifty and it formed a small uptrend channel. Today Nifty managed to close above this channel. Untill this channel is not broken Nifty is heading for sub 8150-8200 levels. 

USDINR:

Dollar did a rounding bottom recovery from 64.5 levels and just gave a breakout above inverse Head and shoulder pattern. 66.93-95 level is next resistance level. Above this a clean move might come ;-).

In Summary, both are giving bullish signals but as per comparison one may give a fake signal ;-).

Vascon Engineer:

New Cup and handle in making. Charts say it all :

  Previous Recommendations are going great. Keep booking if one has short term view. Our Defensive picks are running good (Refer Defensive Picks)

NOTE: Above charts are only shared for learning purpose. These are not some BUY/SELL tips. Do your own research while investing.

Crompton Greaves and Market Updates

Nifty:

Nifty at Important junction. Nifty closed just below trendline resistance. Any close above this resistance, Nifty is ready for 8200+ zone otherwise 7400 levels are waiting for Nifty. Next week will be crucial for Nifty.


Crompton Greaves:

Crompton is trading in range from last year. Any close above 190 will be good opportunity for quick move. Keep Close eye.


The coming weak also bringing expiry due to which market will be volatile but weekly close will be important as Nifty and USDINR are at important junctions.

Mercator also gave Breakout this week.Follow up move might be seen soon. :)

NOTE: Above charts are only shared for learning purpose. These are not related to any BUY/SELL tips.

Market Updates and Few more interesting charts [Zee News, Dcb, Radico ]

Wishing all the blog viewers a very Happy Diwali. May this year bring more happiness and prosperity to the lives of each and every one.

Nifty:

Nifty broke the uptrend channel and now 7825-7850 area is resistance for further upmove. We might see some more fall may be 100 more points in nifty before some pullback. Moreover, RSI is approaching 25 area so may be some pullback may be seen soon but have to watch closely if it stays or not.

USDINR:

USDINR gave good trending move from 65 to 66.5 in short span of time. Its consolidating now. Fresh move above 66.5 for 67+ in short term. Watch out.  FSL started giving move as mentioned in previous post IT Pack - Dollar and IT Companies

ZEE NEWS:

  Currently in channel. Any breakout above this channel can give quick move till 38 levels. Keep close eye.

DCB:

DCB is near important support zone. It may give some pullback. Daily RSI is also showing some divergence. 

Radico khaitan:

Good Breakout seen on weekly charts breaking current channel resistance. Some quick might be seen if breakout sustains.

NOTE: Above charts are shared for learning purpose only. Do not treat these tips as BUY/SELL Tips.

Nifty , Bank Nifty and USDINR post Bihar Verdict

Has the Modi Magic failed or something else. BJP is not able to leave good mark in Bihar elections. Don't know how market will welcome this result.

Lets focus on the charts to get the clues for next movement:

NIFTY:

Nifty is still trading in the channel which was started 4 months back. Nifty is still in ping pong mode as 8350-8480 levels were not taken out. This week close was just at support. Any close below this Nifty is headed towards again to the bottom of the trend. Anyways, Nifty has clusters of support in range 7380-7650. Nifty is expected to be very volatile before start of new trend.

Nifty will not resume bull rally which started 1.5 years back untill the current trend line is taken out.

Bank Nifty:

Bank Nifty is also moving in similar trend line. We have to wait for some divergences before taking any bounceback trade. 

USDINR:

The breakout finally happened on dollar chart. This breakout happened on thrusday itself and it gave clear indication that some major impulse wave is coming soon next week. Although Nifty chart closed at support confusing the election outcome due to mixed exit polls but this was the chart suggesting some negatives are around the corner.

The dollar charts are already explained time to time in this blog. From charts, it seems we are heading towards 67+ in near future with some small halts at 66.46 and 66.92 being previous high points.

NOTE: Above charts are only shared for learning purpose and these are not some BUY/SELL tips.

IT Pack - Dollar and IT Companies

Nifty and Bank did some reversals from the levels posted in last post. 7980-8020 did the trick on Monday but it seems momentum missing in market. As far as Nifty stays above 8040-8060 or above its positive otherwise another round of selling can be witnessed.

Today we will discuss charts of Dollar along few IT names :

USDINR:

Dollar is at important junction now. Staying above 65.25 it managed to reach upper trend line. Any close above this trend line , the upper mentioned levels can be seen in quick time. Above 66.44 it will make higher high which will first signal of trend change. Keep close eye.

TCS:

  TCS is consolodating in range from last one year. Soon its going to test the breakout it did 2 years back. The momentum can be soon seen in this counter. Either back in trend-line or to new high.

WIPRO:

  Wipro also gave breakout in 2013 and from last 4-5 months consolodating and range contracting. Any move below 520 odd level back to previous supports other wise new high.

INFOSYS:

Infosys is trading channel from last 6 years. Made low in 2013 and its running good after that. Breaking the trend line will open new trajectory in this stock. Keep Close eye.

TECH MAHINDRA:

Similar lines, started rallying in 2013 and recently retested breakout.


FirstSource Solutions:

 Similar patterns seen in some midcaps as well. FSL gave rally from 12 to 44 and its again standing near resistance. Any cross some good move expected.

All the stocks initiated good trend in 2013, one of the reason at that time was that Dollar gave huge breakout and rallied from 53 to 68. So if dollar again gave good breakout then we might see similar moves again.

Below are the long term charts of Dollar which suggest such move is possible again:

Dollar is currently at the bottom of trend line and any move beyond previous high will conform new trend.

NOTE: Above charts are shared from Learning purpose and these are not related to any BUY/SELL Tips.

Bank Nifty, Nifty and Mercator Lines

Bank Nifty:

Bank Nifty is trading near support of hourly trend line. If sustains 17000 levels then it can again retest high otherwise a serious correction is waiting.

Nifty:

    Nifty is also trading close to support zones. 7980-8020 being support zones on hourly. Breaking this zone Nifty can retest previous lows again.


Last week we warned traders to be cautious as Nifty was forming a bearish wedge and Dollar was ready to give breakout. Dollar did close well above 65.25 levels. It will be interesting to see how it pans out in future.


Mercator Lines:

  This stock has been making multiple tops in 24.5-25.5 range in last three months. Moreover, the range is compressing and it seems some big move can be seen in this counter. Keep eye on this.


Note: Above Charts are shared for education purpose only and these are not some BUY/SELL tips. Do your own research before investing.

Nifty and Dollar updates

Nifty near strong trend-line resistance. Also its forming a wedge at the top along with crucial fibbonacci resistance. Bullish only if stays above 8420 zone.

8380-8420 Crucial zone to decide next move in Nifty.

Dollar is stuck in range between 65.23 to 64.62. Break in any direction will make a big move in either direction.

Both near crucial support and resistance. It would intresting to see which direction these charts will point to in future.

NOTE: Above charts are shared for learning purpose only and this is not some BUY/SELL tip.

Nifty and Dollar Updates

Nifty was finally able to break 61.8% fibo level and it seems its getting ready for next move. Let see what chart is suggesting:

  After 61.8% retracement , Nifty corrected till 8087 which is almost 50% retracement beyond which was able to reach again 61.8% retracement. If this level exists for 1-2 sessions then expect a movement till 78% now.

Moreover, trendline resistance is near 8380-8400 levels and will be interesting to watch if certain levels are taken out or not.

Nifty is approaching resistance and Dollar is approaching support. Lets have look at Dollar chart now:

On the other hand, Dollar is approaching support zones. This means next 8-10 sessions very important to decide short term trend of market.

Keep a close watch. :)

NOTE: Above charts are shared for education purpose only and these are not some BUY/SELL tips.

Nifty View

Nifty is consolidating in very narrow range and trending move is just round the corner. We will soon see 100+ pointer move in either Thursday or friday :

Nifty trading in trendline and is currently stuck between upper trendline and 8090 level , the previous high. If broken 8090 then Nifty might head towards lower line otherwise we will again retrace till 8240-50 range now.

Mild Divergence also existing which is suggesting we might fall from this level. Let's see.


Note: The above chart is shared only for learning purpose and it's not some buy/sell tip.

Nifty Updates and Few Good Looking Charts

Lets see what we have in store from Nifty point of view.

The above is Hourly chart of Nifty. Nifty is trading in a channel and its near channel resistance area. Break out above this range will bring Nifty to longer channel resistance which is near 8350-8400 zone.

If not able to break recent high of 8230 zone then it can retest bottom of channel.

Moreover , Nifty just retraced 61.8% retracement at 8225 zone which is mentioned in previous post.

Few more interesting charts:

ADF Foods:

South Indian Bank:

Bliss GVS:

Note: Above charts are shared only for learning purpose. These are not BUY/SELL tips.

Nifty and Dollar Updates

Nifty managed to cross 50% retracement today after 3-4 failed attempts. If we look closely, Nifty did breakout of Inverse HnS pattern as well.

So logically Nifty has targets as
T1 8229
T2 8325
T3 8417

It can reverse from any levels above. It would be good to take small profits at above levels who are long from sub 7600 levels

NIFTY:

  Breakout above 8060-8097 Range is positive and it may test now 8229, and 8325 levels. Major long only above 8417. Earlier also mentioned that new buy only above 8060. It seems gap up will reward the trend followers who longed above today's breakout :).


USDINR:

Dollar is nearing strong support zone or previous breakout zone. It may give good bounce from support zones. Generally rise in USDINR brings fall in Nifty and both are approaching support and resistance zones. It would be interesting to see how things turn out.

64.8 and 64.5 is strong support zones. Watch out :).


Mostly all previous chart learning are working well as per expectations except Alpa Lab where volumes are lacking. One can book partial profit or trial SL on these positions now.

Reliance 835 to 890
OBC 130 to 138
VIMTA 64 to 70
Gruh 253 to 270
JK still waiting for move
Alpa Lab follow up move missing
DCB 129 to 142+

Note: Above charts are shared for learning purpose only and are not intended for some BUY/SELL tips.

Hero of 2007 - Reliance Industries

Reliance Industries was one of the biggest leader on 2006-07 Rally. After 2008, Reliance stuck in range and become trader's stock for last 6-7 years.

Following are the long term charts of Reliance:

Clearly Range for Reliance is keep on decreasing and soon we will see breakout followed by big trending move. Announcement of Reliance Jio is also one major news which is just around the corner.

On Downside, just near support. Breaking 800-830 area will take the stock back to 670-80 levels which might not happen.

On technical side, buy will be triggered once 1050 current trend line which will keep on decreasing with time.

Right now, the spring is getting stretched and move will come once its released.


Now , Lets add a Fibonacci retracement view as well, just to cover how Reliance respected Fibo ratios :

  Clearly , it seems Reliance is also respecting Fibo ratios :):

• Straight recovery till 61.8 %
• Remain in range between 38.2 and 61.8% for 1.5 years.
• New Range between 23.6 to 38.2 for next 2 years.
• Recent fall from 50%.

So from above conclusions , 690-740 is very good range to accumulate Reliance. It may also happen that these levels may not come in that case, buy above breakout just before Run-away with the help of Technicals/Charts :).

Note: Above post is shared only for learning purpose. This is not some BUY/SELL tip.

One can comment if want technical views on some particular stock.

Nifty And Fibonacci

Lets study now how Nifty reacted recently on Fibonacci ratios.

   Time taken for Analysis : Oct 2014 to Jun 2015

    Nifty rallied from 7720 odd levels to 9119 and started corrected after that.

• 23% ratio was broken easily. 
• Nifty found support at 38% rallied till 23% and again fell.
• No Support at 50%
• Support at Golden Ratio 61.8% which made Nifty rally till 23%.
• Again fell till 78.6% and recovery till 50%.
• Again fell and recovery till 38% now.

    So, clearly somehow fibonacci ratios are respected. Once we can understand power of fibonacci then we can trade once these levels are respected for next level in same direction.

     Now Lets Analyse Current fall and check why 8050-60 zone was resistance for Nifty :

   

       In current fall, Nifty fell from 8060 levels and following were the resistances:

• 50% Retracement at 8064 levels
• Previous tops at 8050-8080 range.
• Gap above 8080 range.

      More the number of resistances more risk rewarding trade becomes. Nifty has already seen 250+ points fall from that level.

      Now , Lets Analyse long term Nifty movement with Fibonacci and how trend line and Fibonacci can be used to predict moves:

    Following are the observations from above chart:

• Nifty respected 23.6% and gave small pullback.
• Made Double bottom at 7890 (38% retracement) and rally till top of trendline.
• Made one more bottom near 50% retracement and gave sharp pullback. Also tested bottom trendline.

       So when we combine multiple indicators probability of move also increases.

       So from above chart 7515 or 7480-7530 becomes major support zone for Nifty and if Nifty sees these levels post RBI policy, This can be a golden opportunity to take longs both from trading and investment prospectus. Moreover if 7480 is broken then next level  is 61.8% which is 7139 which will be very very quick. 

       Moreover, if Nifty break 8060 on Upperside then we can see smooth rally till 8250 zones.

NOTE: Above charts are shared for learning purpose only and its not a BUY/SELL call/tip.

    

Nifty View

In our last view, we told that Nifty may test 8000 area if 7850 taken out. Nifty tested 8050 region and then corrected till 7717.

Now moving forward, Nifty is still in down-trend channel which started 6 months back. From here, next move will only come of Nifty closes above 8060 which will give a nice Cup and Handle breakout otherwise Nifty can test trend-line low again which will be range 7400-7500.

    Nifty is currently in no trade zone. Wait and let Nifty give directions :)

NOTE: Above view is presented only for education purpose and this is not any BUY/SELL recommendation.

Importance of Fibonacci Retracements

Fibonacci Ratios have very important role in technical analysis. It has been generally seen that charts generally respect these ratios. History has revealed that these ratios have certain impacts on price action. The rise and fall does not move in straight line but up down movements are some of retracements only.

One can Refer wiki for how these values are calculated:
https://en.wikipedia.org/wiki/Fibonacci_retracement

Following are Fibbonacci ratios normally used:
23.6 %  - Minimum Re-tracement
38.2 % - General Re-tracement
50 %
61.8% - Golden Ratio. Most common in big moves
78.6% - Some time golden extended to 78.6
100%

Let have look at following chart of SBI. Below chart is last 8 years chart of SBI where multiple up-down moves are seen.

    We have here considered the SBI move from 2009 to 2014. SBI rallied from 88.4 to 352 in two years. Started correction from 352. Now lets check what it did at each fibonnaci retracements.

• 23.6 was straight away broken, In bigger time frame waves this ratio is generally not repected.
• 38.2 was respected but now 23.6 became resistance which resulted finally to break 38.2 as well.
• 50 % was again respected and move till 38.2 was seen but that resistance was not broken.
• 61.8 % in first attempt broken but after that it acts as a support as well but since it was broken initially so ultimately it was broken with 38.2 as major resistance.
• Final support at 78.6 with double bottom and double top at 61.8 finally this downmove ended.

Now lets see current down move in SBI along with Fibonacci retracements:

   In current down move , so far bottom has been formed near 61.8 Fibonacci , if this low is not taken out then fresh upmove can start but its not necessary. We can observe similar patterns here as well like how price behaves at various fibonacci ratios.

We can apply Fibonacci ratios to any chart and can see magic of values. Sometimes these are also called magical numbers. SBI chart was taken a random chart to demonstrate importance of these ratios.

NOTE: The above chart was only for learning purpose and not some buy/sell tip.

Bullish Pattern : Cup and Handle (Alpa Labs)

Today we will discuss regarding one of the most successful pattern named Cup and Handle Pattern. The pattern is in the shape of a large cup followed by a small handle which is similar to U shape where the initial fall and recovery is very fast.

These patterns are successful when top of CUP is crossed with full force along with good volumes. Sometimes the neckline is retested but sometime smooth move is seen.

Lets look at one of the example:

ALPA LAB:

 Here, we can see the stock first formed a CUP in almost 4 years, followed by a handle in next 7-8 months. It just gave a breakout in quick time span. So here if stock break 21 21.5 on lower side then it can be a failure otherwise stock is ready to catch up.

In Cup and Handle pattern we have two targets.
Target 1 is Size of Handle (10 rs in this case)
Target 2 is Size of Cup (14 rs in this case)

Risk reward entry here is good and any pullback to 22-23 can be traded.

Note: The above chart is presented for learning purpose only. This is not a trading or buy/sell tip. So your own research for stock.

Waves and Stock Price [JK Tyre and Gruh Finance]

Lets Discuss today something on waves. The share prices generally moves in waves. Impulsive waves are quick in direction of trend while others are complex where price remains in some definite range before decisive directional move.

During complex/consolidation waves, we need to check whether there is accumulation or distribution. This thing is not straight forward so best is to react when trend line breaks in either direction.

Lets have look at examples of such moves:

GRUH FINANCE:

 Starting from Trending move, the wave started first correction for few months followed by breakout to start first impulsive move in the direction of trend. Made high of 320+ in JAN '15 and again in consolidation phase. Did smaller wave breakout and did some move. Again on the verge of breakout. This can be start of new wave if price sustains.


JK Tyre:

JK Tyre is also in consolidation from last 8-9 months with some negative bias. A rise in volume was seen in last upside and now price range narrowing before break out or break down. One can keep close eye to find which direction it goes.


Note : The above charts are shared for learning purpose and not for any buying/selling recommendation.