#Cupid
Nice breakout after setting a 2 year base.Nice volumes last week.
Short term resistance is near 346 (PREVIOUS ATH of Jan 2018)-once it crosses 346 decisvely , we can see bigger targets.
There are chances of some pull-back as all indicators are stretched.
#NGL Finechem -Can see more correction - if overall market goes down,can go back to previous lows. On the other hand ,if it crosses 2500, there is a hope for an upmove. In nutshell- wait and watch.
thanks a lot , please can u check HCC ?
Have We Entered Bear Market ?
As per Elliot Waves and Stage Investing theory, yes we have enetred in a bear market.
Logic 1-based on Daily Chart.
a) Triple Top Failure
b) After April 2020, the fall is in 5 waves -first time. In EW , any fall or rise in 5 waves is known as impulsive. That means the market would now move towards the direction of impulsive wave …in this case, first V waves are part of wave A, would be followed by Wave B ( 3 waves) and then C Wave should follow (another 5 waves)
c) Most of the sectors have completed their 5 waves , so Nifty waves and majority of sectors’ ways are in tandem.
Logic 2 -Weekly Charts
a)Have broken 30 EMA as well as 40 EMA (200 DMA)
b) Had broken these earlier too, but the rise was in 3 waves ( that means a corrective bounce ,a corrective wave in EW terms)
What we should expect now 
Possibilities as per daily chart -Levels mentioned in the chart:
Here is what an ABC decline looks like …market may not move like these clean lines , but it reprents the bigger picture.
Possibility as per monthly chart
We might stop at 20 months avergae - dotted yellow line… that may go up or down as per the movement in next few weeks.
Disclaimer: These are probabilities, market is supreme .Take a guess but listen to what market is saying ---- these set-ups as per one view, to work in the markets, we need to make certain assumptions. Some other EW guy might have certain other vies as in EW , you get several set-ups.
In nutshell : Be catious, be careful in adding falling knive
Major Global Markets in Stage 2
When central banks stop printing money, effect is visible all around.
It is not all about fundamental of the companies, it is lot about liquidity also.When the tide comes, even the stones start floating and when the tide turns away , even the fish suffocate.
Ignore the liquidity levels for your own peril.
Nikkei 225 (Japan)
Tried to come out of the jinx after 32 years (since 1990 , the Japanese market is in a bear phase) – but again getting stuck in Satge 2.
France -CAC
Tried to come over 2000 levels ( a breakout after 22 years), but now stuck in Stage 2.
Germany -Dax
Back to PRE-Covid levels -Now in Stage 2.
Ibovespa -Brazil
Struggling in Stage 2.
Last year ,when liquidity was there, market was booming despite a worst drought of 50 years.
Kospi- Korea
Like many other global markets, stated falling in Nov/Dec 2021 - gave back all the gains of last 2 years. Now in Stage 2.
Dolat AlgoTech
CMP-92:10
A broking company -availavle at very low PE- good growth in last few years.
Breaking out in S2 and a new Wave has started , supported by good volumes, should go a long way.
84 is the level to watch out for this set-up getting failed.
Chart for study purpose only, no recos.Probability of technical-failures always there.
Nasdaq
In Stage 4.
7-8% further fall expected .
Smaller tech- companies corrected by 60-70 % in last 6 months but was not being reflected the index—now biggies also entering in Stage 4- directly visible in the index.
Microsoft
CMP 270
An important constituent of Nasdaq
At a crucial level - In Stage 4, Wave 2 and a kind of Head & Shoulder pattern .
If the neckline breaks in coming days , can’t rule out the levels of 210-220.
SHOPIFY
What a fall!
1750 to 425!
Price ( 428) - even lower than pre-Covid levels.
Had enough warnings on the chart- even for a novice investor.
Stage 2 break down, Long-term channel breakdown etc etc.
Next support is at 407- if it does not stp there–we might see the Covid -low prices.
Price of A Stock
The price of any stock is a combination of 4 things : Earning growth + Story on future expectations ( few people call it DCF) + Sector Tailwinds + Liquidity (money in the marekt).
You pierece one balloon , and booooooooooooooom!
Currently it is all about money ,honey ! Money - the liquidity provided by Fed and other central banks.
No liquidity and a stock like Microsoft tanked yesterday despite good earnings announcement and buy-back offer.
CARE Rating
CMP 465
Take an oath that as a long term investor, neither you would buy any stock below S4 stage ( it won’t have momentum or would waste lot of time with-in a narrow range) nor you would stay in a stock that has given a Stage 4 breakdown as you don’t know how more downside is left.
If it breaks 445, next supports are very very far away.
KPIT Tech
CMP -560
Let’s study together - track this to learn few insights from Stage -Analysis and EW theory.
Today, it seems that KPIT has bounced back after making double bottom !
But is it out of woods and ready for next upmove -next wave?
Well , as per Stage Analysis - it is difficult for stocks to maintain momentum once overall market sentiments is negative or is subdued …so not having much hopes.
As per Dow theory, it should fist cross 640 levels ,the last swing high - that would be first confirmation that upmove is on.
As per EW theory, it should first retrac 61.8% of recent decline ie. 686 - that would 2nd confirmatin.
Then it should cross previous high 800 and then 138 % of recent decline. And there should be at least one impulsive wave while going up( containing clear 5 waves) .
So many confirmations required - one adds positions as per various level confirmations .
Investing is easier in a bull run when liquidity is there , everyone is optimistic ---- one can ride any stock- when tide comes , even stones start floating.
But in bear market, every step has to be taken very cautiously.
Hi,
Thanks for putting the charts and your thoughts up for the community…
Using KPIT Tech as a live case, say if we are looking to invest now, how can one approach this?
Would one have to wait for all the 3 triggers to play out, or would one be best served by breaking the investment in to 3 equal tranches - each tranche deployed on each trigger. In the latter case, there needs to be an exit call also if there is breakdown after any one of the stages…
I go by position-sizing - i was tracking it for few days and added intial position (10%) when it corssed 554 ( previous swing high at daily charts)…now it is stretched, should give a pull-back - would add other 10%.
Then 20% when it crosses 640. Then 30% when it crosses 686 …rest once it crosses its ATH price.
Position sizing depends upon a person’s own attitude also as well as market conditions— a risk taker can go more aggressive after 640 in a bull market. But i am bit conservative invesor and it is a bit worrisome market, so I tend to go slow especially in these conditions.
Exit is based on once it breaks down into S4 stage - part exit when it breaks 10 WEMA , channel-break can be other one,fully if it breaks 30 WEMA.For very long term investments, where one is having good profits, few people tend to wait for 40 WMA .
That is a simple method, but I personally go by wave counts.
There few finer points also–exit in instalments as you get break-down confirmations.
Keep an eye on the thread, I intend to expalin everything about Stage Analysis and EW as we go along.
Thanks for the quick response.
I am not at all familiar with charts and patterns. So making this a bit more practical for learning. Let’s say we start with Rs.1L as total amount that one would like to put in KPIT for long term. So when it crossed 554, Rs.10k was invested. Now given the pull back another 10k.
There are 2 paths from now on where action might be triggered,
the up move when it crosses 640, so we invest another 10%, say…
or down move where it drops below 30 WEMA when it’s a full exit.
What is the 30 WEMA, price point of 30 WEMA. Is this a moving average data point in which case it could vary over a period of time and what is the acceptable period of time…
Just open the chart on TradingView.com on Investing.com - go to weekly option- from indiacators add EMA ( exponential moving averages ) - have 3 EMAs at least - 10 ,30,40 .
On daily charts, same EMAs would act as 10 days averages, 30 days averages, 40 days average.
On weekly chart, these would be 10,30,40 week averages ( 50 days,150 days, 200 days).
Managing initial entries is important - for that many a times, exit can be done at various indicators 
a) breaking of 20 Day moving average ( put Bollinger band from indicators on dialy charts, the centre line of Bollinger band is 20 DMA.
b) Exiting when it akes a Swing Low ( read Dow theory from internet- Higher HighmHigher Lows, Lower High,Lower Lows etc)
c) Other simple method can be putting MACD from indicators, exit when it gives sell sign. ( bit tricky as many a times it whipsaws and can give late/early exit)
But start trying using these , you would get some experience.
Technical investing is for people like me - who are neither CAs (don’t understand much of the balance-sheet) nor have time/resources to scuttlebut. We tend to ride on the shoulders of fundamental and institutional investors - who invest after doing lot of research, When they buy -volume and price give enough indications for the people like us to ride along-with them.
Tesla
CMP -876
One of the most loved/hated stock across the world .
Has it entered Stage 4 , bigger corrective Wave 2 ?
Seems like !
If yes, then our first stop should be near 700 .
Future path can be decided only after that juction.
If someone is intrested in learning about Stage analysis and EW, he /she should see and read the chart very closely — have tried to give few basic insights.
Analyst Ratings
The people who earn millions by giving buy/sell/hold ratings -US context (India is no different).
Let’s check what were the ratings from the key analysts when FAANG stocks were at peak valuation.
Meta (Facebook) – Peak: 10 Sept; $379 – Down 53% to $180 (The analysts said 34 buy, 17 hold, 1 sell – consensus “Overweight”.)
Apple – Peak: 10 Dec; $179 – Down 12% to $157 (The analysts said 26 buy, 10 hold, 1 sell – consensus “Overweight”.)
Amazon – Peak: 9 July; $3719 – Down 25% to $2787 (The analysts said 42 buy, 2 hold, 1 sell – consensus “Buy”.)
Alphabet (Google) – Peak: $2974 5 Nov – Down 20% to $2390 (The analysts said 42 buy, 7 overweight, 1 hold, no sell! Consensus – “Buy”)
Netflix – Peak: $690 29 Oct – Down 72% to $198 (The analysts said 11 buy, 29 hold, 3 sell – consensus “Hold”)
In short, no one knows anything …everyone is faking out and few make money out of it
Source :Interactive Broker
Ujjivan Finance
Special Situation Investing
Via Technical Analysis
I came across this Special Situation - It is the reverse merger arbitrage. On can read more about fundamental thesis by clicking on this link -Ujjivan Financials -Reverse Merger
Like everyone else, I like Special Situations -especially in a sideways /bearsih market as these sitaution provide some basic safety in the form of value unlocking ( in bull-markets, I tend to get into these situations only at critical junctures as these things take time to work-out and capital is limited).
So how I plan to play this situation
Route 1
Stage Analysis and basic Technical Stuff
As per stage analysis, this stock is in S3 ( oscillating between S2 & S4- trying to form a base - and that is a good thing- a stock should consolidate in S3 for sometime so as to shake out the weak hands.
Keep in mind ,the longer the base i.e. S3 , faster the upward thrust when it breaks out S 2) - it is trying to breaksout in S2.
Look at the chart, there are lot of resistances on the left- if it was not a special situation, i try to avoid these kind of stocks ( more of the left -side- resistances, slower the upward movement )
So it has few resistances- I would add certain % position after it crosses each hurdle . As the arbirage -profit window is narrow, i would be aggressive when it crosses initial hurdles.
Another hurdle ( that is not shown in the chart) is this one crossing 61.8% of recent decline - but that is near 225 -so i wont worry about that as of now .
Route 2
Via Elliot Waves
As per Ellliot Waves, on hourly chart we can see that it has made Wave 1 nad now it is correcting in Wave 2 – wave 2 correcrtion levels can be 138-128-122 depending upon different Fibo-levels(stop-loss 100)
Recently it has made a double bottom at 138 and stock is trying to breakout of the falling channel, it tells that correction may be over.
Or may be not , if the market corrects further it can go to 128/122.
So initial postion can be made with a strict SL of 122.
A clear 5 waves impulse ( fractals of bigger Wave 1) towards upside somewhat assures that an upward -move is on the way .It is one of the many confirmations.
Later on one can keep adding as it crosses different hurdles.
Disclaimer -Keep in mind that this just a probabilty set-up - these charts are for learning purpose only- no recommendation.
Quess Corp
CMP 709
At an interesting Zone
Trying to get into S2 zone
30 WMA and previous Swing High creating restance ,
Should give a little pull back (wave ii of 3) ,then need some good volumes to gather the force to clear these resistances ( if the market remain conducive) , after that if it enters wave iii of 3 , it can really go long way.
Let’s see how it plays out
Disclaimer : Chart for study purpose only.
Gold view stands cancelled as it has formed a Head & Shoulder pattern on the top ,broken an important support level,and rusing DXY not in favor of rising gold.
