Point & Figure Charting

Stock Opportunities Techno-Funda Picks
301

Ankit,

You have asked a very good question. To this lets start looking at the markets.

http://chartink.com/pointfigure/nifty.html Link: http://chartink.com/pointfigure/nifty.html

On the chart, Nifty is in the O column. It gave a SELL signal at 5500. From there on the markets started falling fast. Today it is at 5350. The next support is at 5250, 5050 and 4800. If the Nifty falls to these levels, you can imagine what damage can happen to individual stocks. There will be total FEAR and uncertainty in the markets. This looks a scary scenario. However, in such situations one gets opportunities. So my suggestion to you is, not to hurry and keep buying in a falling market. Let clarity emerge. It is better to BUY at higher levels where there is clarity and the trend is clear than in an uncertain market.

Next I will write on the Bank Nifty. I am doing my analysis on the Bullish Percent Chart for today and will most likely post the update tomorrow. However, in the mean time the Bank Nifty Bullish Percent Chart shows a reading of 0 (zero) which means extreme pessimism in the Sector. All stocks are in a SELL signal. No doubt, bank stocks are falling like nine pins.

More on this tomorrow.

Tony

302

BANK NIFTY:

http://chartink.com/pointfigure/BANKNIFTY.html

On the PnF charts you will notice that the Bank Nifty has consistently been making Lower Tops and Lower Bottoms. This showed that the Bank Nifty was extremely weak. From a high of 13400 in May 2013, it has crashed to 9264 in August, 2013. In recent days it is displaying a pull back from oversold levels. I would advise investors to stay put and not venture into buying.It is better to buy at higher levels once the trend is known. One cannot keep bottom fishing.

On the Bullish Percent for Banks, data for which I maintain, all stocks are in a SELL signal. The Bullish Percent has reached 0 (zero) since August 16. This shows that the sector has been shunned away by one and all. In such pessimism opportunities arise. It is time to make a list of the best banks one would like to buy. When the Trend emerges, then go and BUY the stocks which are on your shopping list. Till then pray for patience and sanity in the markets.

One more indicator I am working on is the 10 week Bullish Percent. This shows how many stocks are trading above the 50 day EMA. From this analysis as on today only 10 stocks on the BSE 100 are trading above their 50 day EMA. This is not at all a positive sign. As soon as I am able to collect data on this, I will put up a chart and express my views and interpretation of the chart.

Tony

303

HOLDING ON TO LOSERS

The greatest stock investors too have some losers in their portfolios. All stocks will never be winners. But how you handle the losers will determine your success as an investors.

Suppose you had bought a stock at 50 and it fell to 40, this is a 20% loss. You wait with the eternal hope that the stock will make a come back. This does not happen it falls to 25, which is a 50% loss. Now to recover the loss of 25, the stock has to rise 100%, ie from 25 to 50. Is that possible? Just give it a thought !

Seasoned investors do not hold on to losers. They take quick corrective actions so that they have capital to play. Therefore, it is highly imperative to recognize your losing positions and BUY strong stocks which are trading above the BULLISH SUPPORT LINE. Swapping strong stocks with Losers is a better strategy than holding on to losers.

A rational investor will always ride the winners and cut the losers from his portfolio. Novices do exactly the opposite and end up with a portfolio of duds.

Tony

304

VOLATILITY INDEX:

As the markets crashed, volatility increased. It reached the highest at 29.50, the highest this year. This reflects the fear in the markets. Volatility and Market index move in opposite directions. When there is Confidence, markets are less volatile and move in the higher range and vice versa.

http://chartink.com/pointfigure/INDIAVIX.html

The chart above captures the volatility which is very high. The normal range is 12-14.

Tony

305

Dear Tony,

Many thanks for your painstaking research n giving replies.

What’s your take on Bajaj Corp, Canfin homesn astral poly.

306

Dear Tony,

If we look at the volatility index historically

http://chartink.com/stocks/indiavix.html Link: http://chartink.com/stocks/indiavix.html

it shows much higher levels. 12-14 seems to be the lowest range. How can this be interpreted?

http://chartink.com/pointfigure/INDIAVIX.html Link: http://chartink.com/pointfigure/INDIAVIX.html

307

Vivek,

Lets look at Bajaj Corp. first:

http://chartink.com/pointfigure/BAJAJCORP.html Link: http://chartink.com/pointfigure/BAJAJCORP.html

This is a strong stock trading above its Bullish Support Line since July 2012 except for a short spell. Currently the stock is trading in the X column showing more buyers than sellers. The stock is still in the Sell signal and has made a triple top where it has resistance. Once it breaks this strong resistance the next is at 260-65. After this the stock can touch 280 once again which is its previous high.

On the down side it has support at 230 and 220.

http://chartink.com/stocks/bajajcorp.html Link: http://chartink.com/stocks/bajajcorp.html

On the candle sticks the stock broke the 50 day EMA which is a very positive sign. It earlier took support at the 200 day EMA which is at 233. All the indicators like RSI, CCI and Momentum are showing positive trends. If the markets continue to improve, this stock can reach its previous highs.

Tony

308

dear TONY

CAN I SWITCH ATUL AUTO TO KAVERI SEEDS IN PRESENT SITUATION ? MY AVERAGE BUYING PRICE IN ATUL AUTO THIS YEAR IS RS. 180/- I AM OVER EXPOSED IN ATUL AUTO.

I THINK KAVERI IS A BUY BETWEEN 1500-1550/-

PL GIVE YOUR VALUABLE OPINION.THANKS

309

Tony , Can you please email me Thomas Dorsey book on Point and Figure trading on

shrinani0507@gmail.com

310

Also please send me the book about 5 rules of successful investing on

shrinani0507@gmail.com

311

Please check your mail box. I have sent the books and more.

Link: mailto:shrinani0507@gmail.com

312

CANFIN HOMES:

On the candle stick charts the stock is trading below its 50 day EMA of 133 and 200 day EMA of 147. The stock is weak. Currently the RSI is close to oversold level of 30, CCI -72, and Momentum -5.7. In a weak market do not expect weak stocks to move up much. Also market leaders like HDFC are also on a SELL signal.

http://chartink.com/stocks/canfinhome.html Link: http://chartink.com/stocks/canfinhome.html

On PnF charts:

The stock is on a SELL signal in the O column. The next support levels are 118-108-102 and 100. The stock is also below the Bullish Support Line which indicates the Trend is weak.

Tony

313

ASTRAL POLY:

http://chartink.com/pointfigure/ASTRAL.html Link: http://chartink.com/pointfigure/ASTRAL.html

The stock is currently in the X column but on a SELL signal. However, the stock now has resistance only at 570 then at 600-620. On the lower side it finds support at 480 and then at 450. It is trading above its Bullish Support Line which is a good indication.

Note: Stock split record date is 5th September.

http://chartink.com/stocks/astral.html Link: http://chartink.com/stocks/astral.html

On candle stick chart, the stock is trading below its 50 day EMA at 562 but above its 200 day EMA. The RSI is close to oversold level at 34, CCI - 147 and Momentum at -44. Two out of 3 indicators are showing negative trend.

The stock can find support at its 200 Day EMA at 437. Watch for this level. Any drop below 437 will give a huge break down.

Tony

http://chartink.com/stocks/canfinhome.html Link: http://chartink.com/stocks/canfinhome.html

Dear Tony,

Many thanks for your painstaking research n giving replies.

What’s your take on Bajaj Corp, Canfin homesn astral poly.

314

Can u please analyse Sun Pharma and Ultratech

315

Akbar,

The Volatility Index has an inverse relationship with the Stock markets. Volatility index advances when the stock market declines and when the stock markets advance, the volatility index declines. When markets decline, they are viewed as risky and when markets advance they are viewed as less risky. If you note in the chart when the VIX was at its highest, the stock markets were at the lowest. VIX always trends in the opposite direction of the stock markets.

Tony

http://chartink.com/stocks/indiavix.html Link: http://chartink.com/stocks/indiavix.html

VOLATILITY INDEX:

As the markets crashed, volatility increased. It reached the highest at 29.50, the highest this year. This reflects the fear in the markets. Volatility and Market index move in opposite directions. When there is Confidence, markets are less volatile and move in the higher range and vice versa.

http://chartink.com/pointfigure/INDIAVIX.html Link: http://chartink.com/pointfigure/INDIAVIX.html

The chart above captures the volatility which is very high. The normal range is 12-14.

Tony

316

Dr. Mehul,

I will stick to my analysis of both the stocks leaving the decision to you whether to switch or not to switch. Investors buy and sell stocks as per their own perceptions. Try to reason why you had purchased the stock in the first place, and what is making you sell it now.

ATUL AUTO:

http://chartink.com/pointfigure/531795.html Link: http://chartink.com/pointfigure/531795.html

On the PnF charts the stock is in the O column and has given a SELL signal. Next support lies at 140-145. The Bullish Support Line is at 138, any fall below this will take the stock to 130. However, till the stock trades above 138, the stock is a strong stock.

http://chartink.com/stocks/531795.html Link: http://chartink.com/stocks/531795.html

Currently the stock is trading below its 50 day EMA at 182 and 200 day EMA at 177, hence the weakness. All the short term indicators are weak with RSI at oversold region of 27, CCI -176 and Momentum at -26.

KAVERI SEEDS:

The stock is a strong stock and is currently in O column but on a BUY signal. Despite the carnage in the market, it has not reacted much. However, in a bearish market which may be in its final leg, strong stocks too start falling, eg. In banking sector all the stocks have fallen except HDFC BANK. When this stock starts falling, then it is an indication that the Bear Market is in its final stages.

The next support is at 1450 and then at 1320 near the Bullish Support Line. Any fall below this, will take the stock to 1260, 1220 and 1160. On the up side the stock has resistance at 1700.

http://chartink.com/pointfigure/kscl.html Link: http://chartink.com/pointfigure/kscl.html

The stock is trading just below the 50 day EMA at 1580. If the markets do not improve, chances are there for the stock to touch the 200 day EMA at 1375. So be patient in buying this stock. Watch for levels of 1580 and 1375. The CCI shows that the stock can move lower.

http://chartink.com/stocks/kscl.html Link: http://chartink.com/stocks/kscl.html

In my view, shifting from Atul Auto to Kaveri Seeds will not give you much appreciation as Kaveri is trading at the upper price band from where you cannot gain much. If Kaveri corrects substantially, then you can gain from a switch as the upper band of Kaveri is currently capped at 1700.

Tony.

317

SUN PHARMA:

This is a very strong stock. Earlier it gave a SELL signal at 500 and then touched 480 from where it reversed. This is a bounce back. Although the stock is on a SELL signal, it is in the X column. The next resistance is at 550 and then 580.

On the lower side it has support once again at 480 from where it reversed and then at 460. In a worse case scenario it can touch 380.

http://chartink.com/pointfigure/SUNPHARMA.html Link: http://chartink.com/pointfigure/SUNPHARMA.html

The stock breached its 50 day EMA of 524 and now has support near its 200 day EMA of 438. Any fall below 438 will precipitate a big fall in the stock. So watch for this level. All the short term indicators are displaying negative bias with RSI near its oversold level at 34, CCI -119 and Momentum at -42.

http://chartink.com/stocks/sunpharma.html Link: http://chartink.com/stocks/sunpharma.html

Your patience will be tested in this stock. If you are patient, chances are there to get this stock at lower levels. Strong stocks are always a buy on dips.

ULTRATECH CEMENT:

All cement stocks are weak and are pricing lower growth in this quarter. Ultra Tech is no exception.

http://chartink.com/pointfigure/ULTRACEMCO.html Link: http://chartink.com/pointfigure/ULTRACEMCO.html

The stock breached the Bullish Support Line at 1650 and fell to 1581. The stock is weak. It gave a SELL signal at 1700 and fell all the way to 1581. Now the next support lies at 1500, 1450,1360 and 1220. On the up side the stock has resistance at 1750, 1800, 1950 and 2050.

http://chartink.com/stocks/ultracemco.html Link: http://chartink.com/stocks/ultracemco.html

Once the stock breached its 200 day EMA of 1899 and 50 day EMA of 1827, hell broke lose for this stock. That is why I keep writing about these two psychological levels repeatedly. The short term indicators too have a negative bias with RSI at 22 which indicates highly oversold levels, CCI at -116 and Momentum at -192. The trend and momentum for this stock are negative. At lower levels this stock looks attractive from the long term point of view.

Tony

318

Thank you Tony.

319

Tony ,

I amanalysing Page Ind chart. It made double top at 4300 and gave buy signal at 4400. Currently it is in ‘o’ column and will make double bottom at 3900. It will give a sell signal at 3800.

Is the analysis right?

320

Hello!

Your reading of the chart is absolutely right. Please read my earlier postings on Point and Figure at the beginning of the thread in this section.

Tony

amanalysing