Markets Next Week: Technicals

The rally took the market to 5178. How are we placed technically. Lets take a look at few of the Technicals which could give us a clue about the markets.1. The lower end of the Bollinger Band was touched and at around 4950 and then the markets rebounded. The Bollinger bands had narrowed and now they have started widening. The upper end has moved to 5208 from 5181 and the width was around 230 points when the bands were narrow. This could mean a rally...

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UP, UP and AWAY

It was a mind-blowing rally on D-Street. The Nifty rallied to close at 2009 closing high of 5178. Santa Claus had come to town. Lets see where we can go from here.It was a Bear Trap nicely set by having huge OI built at 5000 and 5100 calls. This is the third month running that OI has been used to mislead the punters.The Markets rallied as anticipated from 4944, key support areas. They retraced all the losses made in 5-6 sessions in a couple of sessions. The Faster retracement theory states that this is a fresh up move.The FIIs made huge purchases...

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Dollar Index Rises, Nifty down

Last week, we had spoken about the Dollar Index rising and its implications on our markets. The markets shed wait in the last 2 trading sessions and the Nifty is now at 4987. So, where do we go from here?1. The Nifty broke the support line from the November lows. The support at the trend line joining the lows from July comes to around 4860. This is a very crucial support line, breach of which means the rally from March lows may be over.2. The 50 EMA at 4990 and 20 EMA at 5056 have been breached. The 50 EMA is a very strong support and the markets...

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Watch the Dollar Index

The Indian markets ended almost flat for the weekly forming a weekly doji. A Doji depicts indecision and usually signifies a top or a bottom.The Nifty made a triple top at 5182. So does this mean the rally has ended?There just might be juice left for 1 final blow out rally upto 5350 or 18000 sensex. For that to happen, the indices may need to dip a bit.1. The max open interest is at 5200 call for December series and 4900-5000 puts.This means lots of people have interests (Option writers are usually big institutions) to cap this up move at current...

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Dubai Crisis: What it means for India?

The markets tanked on Thursday and Friday. The markets lost about 6.46% to hit a low of 4806 before recovering to close at 4942. The Dubai World inability to pay the loan raising the possibility of sovereign default.Dubai World is a wholly owned subsidiary which has interests in businesses across the world. It has a stake in Dubai Ports. Its real estate arm is called Nakheel which is developing Dubai. Contrary to public perception, only 6% of Dubai's...

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How to play the upmove

It was a Friday second half rally which took everyone by surprise. It looks like the previous high of 5182 for this calendar year could be taken out. So how do we play this upmove?First there are several confirmations we need to wait for:1. The fall from 5182 to 4539 was retraced in slower time than the fall. Retracement in slower time could mean that the rise was just a retracement to the fall. The pullback could be 80% of the fall in extreme cases,...

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Airport Developers: Niche Sector

All throughout history, those cities have flourished which serve as a gateway to countries. The era of colonization may be over but the adage still hold true. London,Paris and Mumbai are just few examples where cities which have ports nearby have flourished. Airports are the new gateways to the world. Every big city in India has just 1 airport or maybe in future to have 2 airports. Airports require lots of land and its a monopoly business.I took a look at the major airports in India. GMR Infra has Delhi and Hyderabad airports under its belt. GVK...

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The Broad Picture: Are we onto new highs again?

The Key event for me in the past week was the RBI picking 200 tonnes of Gold. We have come a full circle since the time, the Indian Government pledged gold with the IMF in 1991.Are we then on our way to new highs?Fundamentals:The Corporate Results, by and large have been good to excellent. The bottom lines of the companies have grown more than the top lines. This shows companies are cutting costs, getting rid of the excess flab accumulated during the good times.Autos, IT companies have done exceedingly well. At the same time, dangers lurk around...

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Is the upmove over?

It was an action packed F&O expiry and a one way journey down. There are several interesting observations to be made which may suggest the entire rally from March 09 bottoms may be over.1. The trend line joining the lows from March is broken decisively on weekly and daily basis.2. The FIIs and DIIs were net net on the sidelines for the month of October. Both were almost net zero in terms of money pumped.http://www.bseindia.com/mktlive/market_summ/categorywise_turnover.asp The BSE link from where I got the data.This means that DII turned neutral...

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Critical Week Ahead

The markets hit a high of 5182 on the nifty before closing the week at 4997. This was a very interesting week, and the week that follows will tell us whether the entire rally which started from March is over or just a small dip. There were several differences this week over the previous 7 months.First, the FIIs were huge sellers on last 3 days. They pulled out almost 1500 crores whereas DIIs pulled out 80 crores. I went back and checked. The DIIs have bee net sellers over August, Sept and Oct. In July they were marginal buyers.This means the entire...

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Diwali Picks

It is Mahurat trading time. We have picked up certain stocks which we feel will do if the markets do well.Also, it is a time of caution, as P/E of nifty is around 23. A staggered buying approach would be good.I would also like to thank Lakshmi Ramchandran for all the efforts and encouragement put in to make this presentation a reality.Please check out the presentation here:http://groups.google.co.in/group/nav-files/web/Diwali%20Picks2009v1.0....

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Markets: Amber signs flashing, but not Red Yet

It was a day trader's paradise this week at the bourses as the markets oscillated.Key events were the dumping of Telecom Stocks, Infy results and Reliance bonus announcement of 1:1. Reliance came out with a bonus issue which surprised the markets but there was no reaction from the markets. An intra- day spike of 6 pc and thats it.The markets typically hail a bonus issue which is nothing but a sentiment booster for the Retail. Eventually after a month or so after the bonus announcement you get the stock cheaper. An example of this was the Siemens...

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Sporting excellence a sign of an emerging superpower

The Olympics for 2016 have been allotted to Brazil. Brazil has edged out established cities like Tokyo, Chicago ad Madrid.Often, when a country is on its way to becoming a economic superpower, it is reflected in the Sports Arena. By this, I mean consistent performances, not a few flashes in the pan, moments of individual brilliance.Lets take the 1992 Barcelona Olympics. During those games, Soviet Union was at the top with 45 golds followed by USA and Germany. China was just making a small splash in the pool with about 16 golds.In the 2000 Games,...

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P/E:An update

The Nifty P/E is at 22.89 as of 01st October.It has exceeded these levels only during the bubble crashes of 2000 and 2008. In 2004, it briefly flirted above this level before falling.We have 2 scenarios now:1. It keeps rising to about 28 creating a bubble like scenario. It would break the previous high or thereabouts and the a mega fall.2. Correct from anywhere here to 5200 zone. Every time it corrects, it comes down to a P/E of 14-16 which would...

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Liquidity Keeps Markets afloat

Lets look at some of the stats for the month of September:1. Nifty has been 6.34% up as compared to 31st august2. FIIs have pumped in 10,854 crores in September and DIIs have put in 518 crores in September.3.For the year from Jan'09, FIIs have put 16300 crores and DIIs have put 23535 crores.The above Stats say a lot. Out of a total of about 40000 crores pumped in 9 months,11300 crores have come in September which amounts to roughly about 26 pc of inflows yet the market moves up only 300 points as compared to 2400 points from the bottom.So now in...

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Markets Tomorrow - Key Levels

I would be putting in key levels for the next trading day for those interested. In case, you find them useful, please let me know so that I would keep posting them here.5 EMA, 20 EMA and 50 EMA are key support levels. The Bollinger band tops are key resistance levelsBBtop 15, 20 5039, 50005DEMA - 49845 EMA - 49283 EMA - 49567 EMA - 490210 EMA - 486620 EMA -477750 EMA -4601STochs - BuyMACD - ...

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Markets: How high can they go?

The Markets keep rising. All the prophets of doom and gloom are decreasing. The bears have gone into hibernation.Happy times are here again.Lets check out the fundamentals. Domestically, the things have improved definitely. Forget the IIP numbers which are overcooked by the government anyway. I look at the Auto Sales numbers as a key measure. Maruti is producing at peak capacity. They are now only constrained by Production limitations.Indian IT companies are again bagging orders. The freeze is beginning to thaw. Domestically, things are beginning...

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Shanghai Noon:Will History repeat itself?

The global markets are interlinked for all the talk of decoupling. The Chinese markets are supposed to be a advance indicator of what is going to happen in other emerging markets.In Oct 07 when are markets were hitting new highs, the Chinese market corrected sharply.They were 21 pc down from their peak in 2 months.Then recovered 13 pc before the Jan 2008 meltdown.This time, they corrected even more sharply in July down about 23 pc from its peak when...

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Nifty P/E and P/B ratios

2 of the most important and basic analytic ratios are Price/Earnings and Price/Book Ratio. Lets us explore how they have behaved over the past 9 years.P/E RatioPrice to Earning ratio in layman's words is how many times the share trades to its profit made.Infosys if it trades at Rs 2000 and Profit (Earning per share or EPS) is Rs 100, its P/E ratio is 20.P/B RatioPrice to Book value ratio states the number of times the company is trading to its book...

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L&T Finance NCD- To Invest or not to Invest

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Is the Bear market Over?

Is the Bear Market over?That is the key question these days. I feel it is not so. Some of my reasoning for why it is not so.I have been talking of a W-shaped recovery since April now. Well, here are some more people talking about the same. Pual Krugman is a Nobel Laureate in Economics. Here is what he has to say.http://economictimes.indiatimes.com/articleshow/4879356.cmsHe is talking about a W-shaped recovery for the US. We are 1 half through. We are just at the point of the 2nd leg up, from where if the recovery continues it will be a V-shaped...

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IPOs: To invest or not to invest?

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