CNX Pharma Index Outlook

CNX Pharma has rallied from 4400 - 7200 odd levels in past 3 years and has relatively out performed the benchmark indices CNX NIFTY.

                                         
                                           CNX Pharma v/s CNX NIFTY ratio Analysis

                                                         CNX Pharma Daily chart

In past 20 trading session index has rallied from 6400 - 7300 odd levels. Almost a 15% rally in the index. From past few trading sessions index is indicating a distribution pattern also same is witnessed in the major stocks. A divergence in the short term EMA's along with the negative divergence in MACD and price distribution is witnessed on the index. Fundamentally also most of the stocks in the index are over priced compartively to thier P/E's. So a healthy retracement of 8 - 10% can be seen in an healthcare index on a break below 7200 odd levels to 6800 break below can lead to further downside which is of still far as of now.

Sun Pharma, Dr. Reddy Laboratories, Cipla and Lupin are the major counters in the index market cap wise. Most of these entities are showing signs of exhaustion at higher levels.

                                                 Dr. Reddy's Laboratories Daily Chart

A 33% rally from 1766 - 2350 in Dr. Reddy labs from past 4 months is seen. Dr. Reddy Laboratories has formed a twezeer top formations on daily candlestick charts and unable to cross 2350 on closing basis from past 7 trading sessions is showing signs of exhaustion.

A sign of weakness is indicated by inability to cross higher channels of bollinger bands, MACD and RSI divergence and distribution pattern. So Long traders can exit their longs at current levels and enter and lower levels. One can short the counter from current levels up to 2380 odd levels with an sl of 2410 for targets of 2200. A close below 2300 will confirm more downside in the entity.

Key support and resistance to watch out for the stock:

Support - 2302/ 2200/ 2100

Resistance - 2350/ 2365/ 2400

                                                     Sun Pharma Daily Chart

Sun Pharma also in a distribution phase has rallied from 400 - 1130  odd levels in past 3 odd years. the stock has been one of the  out performers. A break of short term trendline has confirmed atleast an intermediate correction or profit booking in process. Investors in the entity can book profits and come out of the stock at current levels to enter at lower levels.  The technical indicators are also showing weakness, inability to cross the higher channel of bollinger bands, MACD and RSI divergence along with price confirmation below 1100 will ignite the downside move. So short traders can short the stock at current levels up to 1110 levels.

Support - 1000/ 940

Resistance - 1110/ 1148

                                                       Lupin Daily Chart

Lupin has rallied from 600 - 900 odd levels in 89 trading sessions a fibonacci series completing the up move. The stock has given a return of 50%  in past 4.5 months. A negative divergence in RSI , MACD, unable to cross higher end of bollinger band channel and distribution in price an healthy correction is anticipated on the verge of booking profits. So investors can book profits and enter at lower levels. short traders can short the stock around 895 - 898 odd levels with stop loss of 911 for targets of 850 and 800.

Support - 850/ 800

Resistance - 898/ 910

Trade objectively and wisely with the consideration of own risk with amid volatility. The strategy would be to wait patiently for the right opportunity to unfold to probable profitable trade setups.

Raju V Angadi

Equity Research Analyst

 To know more about probable counts contact us back on rvangadi@googlemail.com 

Disclaimer: This is just an view based on the research of individual for educational purpose. So kindly trade along with the consultation of your financial adviser, market trends, price action and own risk appetite considered while investing or trading in stock markets.

Bank Nifty Analysis

Bank NIFTY has completed 5 impulse wave upward move from 7900 - 13400 odd levels. The corrective wave has started from 13400 odd levels and have completed it now after a wave B upward move in corrective wave sequence has started wave C of correction from 11700 odd levels.

Bank NIFTY Daily Chart Elliot wave Analysis

                                                  Bank NIFTY Daily Fibonacci Chart

                                               

                                                      Bank NIFTY Weekly chart

Considering the principle of equality wave A & C the correction of wave C can be up to 9600 - 9800 odd levels in the index.

The index today it has touched a intraday high of 112340 which is 38.2% retracement of a move from 7900 - 13400 odd levels. The key resistance for the index can be around 11460 - 11620 odd levels. The bankex stocks charts included in the indices are also relatively weaker. So its advisable for traders to use the rally in the index to short around 11420 - 11700 odd levels with a stop loss of 12000 - 12200 odd levels. The positional shorts can be built on the index for lower targets below 10000.

Below 11000 and 10800 odd levels one can add more shorts in the index for lower targets. Traders are advised to avoid long positions until 11460 - 11620 - 11760 which are key resistances if crossed can move up towards  12000 - 12100 which is also 23.6% retracement on daily charts eventually can drift further towards lower targets.

The CNX NIFTY has formed inverted H & S pattern and have broken out which can test targets of 6280 odd levels. Although Bank NIFTY is relatively weaker waiting for opportunity on rallies and weakness with the confirmation of both indices would be better to short sell at higher levels is advisable.

Trade objectively and wisely with the consideration of own risk with amid volatility. The strategy would be to wait patiently for the right opportunity to unfold to probable profitable trade setups.

Raju V Angadi

 Equity Research Analyst

 To know more about probable counts contact us back on rvangadi@googlemail.com 

Disclaimer: This is just an view based on the research of individual for educational purpose. So kindly trade along with the consultation of your financial adviser, market trends, price action and own risk appetite considered while investing or trading in stock markets.

20 Traits Required To be a Successful Trader

• Don't dig yourself into a hole early in the day or in your career. Be willing to observe the market & make an informed decision. Missed money is better than lost money, so wait patiently for the best opportunities to arrive.

• Trade with a blend of anticipation & confirmation. Balancing these two will mean that you adopt a system of "if this happens, I will do that." Wait for your pitch! 

•         Beware of your trading process following a winning streak. Many will make money in the market, but discipline is required to KEEP it. Stay on your guard @ all times!

• When you lose, don't lose the lesson! Forget the names but remember the events. Those who don't remember the past are doomed to repeat it. Make mistakes with composure & character, without blaming others & Don't dwell on mistakes. 

•  When in doubt, get out. Be willing to change direction at any time, because your flexibility as an individual investor is a big advantage which should be embraced!

• You are too greedy. Thinking abt trading profits instead of how u could better execute your plan is an obvious sign of greed.

• Evaluate your results at least monthly. Reviewing these results helps u continually improve your understanding of the markets & yourself. 

• Finally (perhaps most important), always be patient. Long-term patience will keep your confidence & optimism high, & short-term patience will help u wait for the best trades. Success doesn't come easy, and rarely are fortunes made overnight. Sometimes traders find themselves clicking into trades just to be involved with the markets.

• Do u find yourself making acceptances for your trades tht are not in your plan?  What causes this? Is it a need for action? Is it a need to be right? Is it a fear of missed opportunity? One of the reasons many traders struggle - over trading or forcing the trade. 

• The most common misconception among new traders is tht they have to constantly be in the market. 

• Remember it's not the quantity of trades u take, but the quality of your trades u take. 

• By being in the market all the time the trader does not give him or herself a chance to pause and will eventually lose because of the unfavorable market conditions. 

• Don't force trades just because you feel you need to be in the market. 

• Trading out of boredom is the worst reason to be in the market. You need to have PATIENCE 

• Patience is one of the keys to becoming successful trader. 

• Patience will keep you from overtrading. 

• Patience will give you enough time to observe & look for a potential setup for the next trade. 

• Trading is all about probabilities. You must make many trades to get the law of averages to work in your favor. 

• You blame others when the full responsibility is yours. Accepting responsibility is the fulcrum point for succeeding in anything, especially trading. Doing something about it is the criterion. Execution is the reward, not the money. Money is the by-product of executing to plan. Do not blame the broker for a bad fill, when it was you who hesitated. This is just one example, but we are all aware of many others.

• Losing traders often take themselves quite seriously and seldom find humor in market analysis or the trading environment. Successful traders are often the funniest and most imaginative people you will ever meet. They take joy in trading and are the first to laugh or relate a funny story. They take trading seriously, but they are always the first to laugh at themselves.

Bullish pattern breakout in CESC

CESC has been outperforming broader indices from past few months. On weekly charts has formed a inverted H & S pattern and has broken out around 340 odd levels. The stock can give a stellar returns of 40 - 50% from current levels in coming months ahead. A cross above 367 odd levels can ignite the rally in the stock which is 52 week high as well as 76.4% of fibonacci retracement. The bullish pattern targets for the entity can be up to 520 - 530 odd levels.

The good support zone for the counter is around 336 - 338 also 61.8% of the fall from 433 - 190 odd levels. The daily chart structure also indicating a cup and handle formation breakout on upside. So its advisable for long traders can initiate long positions in the entity around current levels and on dips up to 338 odd levels with a stop loss of Rs. 310.

                                           
                                                    CESC Weekly Chart

                                                          CESC Daily Chart

                                                       CESC Daily Fibonacci Chart

Trade objectively and wisely with the consideration of own risk with amid volatility. The strategy would be to wait patiently for the right opportunity to unfold to probable profitable trade setups.

Raju V Angadi

 Equity Research Analyst

 To know more about probable counts contact us back of e-mail us on rvangadi@googlemail.com 

Disclaimer: This is just an view based on the research of individual for educational purpose. So kindly trade along with the consultation of your financial adviser, market trends, price action and own risk appetite considered while investing or trading in stock markets.

                                                

Maruti Suzuki India Analysis

Maruti Suzuki India has rallied from 908  to 1777 odd levels in a 5 wave sequence. It is in a correct wave ABC forming a bear flag after a decline of wave (a) from 1777 - 1260 and wave (b) rise in a corrective pattern from 1260 - 1623. Now has started a wave (c) decline ash shown in Chart 1.

                                             Chart 1.    Maruti Suzuki India Daily Chart

A break below 1530 would intensify the selling in the counter, which confirms a break down of a bear flag. In near term 1575 - 1580 can act as a resistance, which is also a 0.236% retracement of the rally from 900 to 1777 odd levels as shown in Chart 2.

                                       Chart 2. Maruti Suzuki India Daily Finbonacci Chart

The entity has retraced each rally by 0.618 in an impulse and corrective wave pattern equally. Wave 2 has retraced 0.618 of wave 1, wave 4 has retrace wave 3 by 0.618 and wave A has retrace wave 5 by 0.618 as shown in the charts below Chart 3 and Chart 4. 

Chart 3. Maruti Suzuki India Daily Finbonacci Chart

                                         Chart 4. Maruti Suzuki India Daily Finbonacci Chart

Key support and resistance levels

Support - 1530 / 1500 / 1450 / 1400 / 1340

Resistance - 1575 / 1600 / 1638

So trade objectively and wisely with the consideration of own risk and volatility. The strategy would be to wait patiently for the right opportunity to unfold to probable profitable trade setups.

Raju V Angadi

 Equity Research Analyst

 To know more about probable counts contact us back rvangadi@googlemail.com 

Disclaimer: This is just an view based on the research of individual. So kindly trade along with the consultation of your financial adviser, market trends, price action and own risk appetite considered while investing or trading in stock markets.