With the banking sector under pressure, let us now analyse some of the important public sector banks for tremendous buying opportunities they are going to present to us in near future. Our focus will be to assess the buying price of these banks for short and long term investments. We shall formulate buying strategies for some mouth watering opportunities expected to be thrown at us by Public Sector Banks in days to come.
State Bank of India (SBIN)
SBIN has no buying opportunity before 920. Short term investors can enter at around 920 for a gain of Rs 80/90. Long term investors can invest 25% at this level. If SBIN breaches 920, one can safely look for a buy at 730. At 730 short term investors can look to pocket a profit of
Rs 280. Long term investors can pump in another 50% money at 730 level.
PNB
Short term investors can look to enter PNB at 338 but should quickly book profit of Rs 35. Long term investors can put 25% of their investment at level of 338. If PNB breaches 338 then buy it not before 300. Short term investors can then get Rs 100 as profit from level of 300. Long term investors should put in another 50% of their money at this level.
Bank of Baroda
Buy Bank of Baroda not before 198. It may touch 190 in intra-day move. Short term investors can look for a bounce of 25/30 points from level of 198. Long term investors should just put in 25% of their money at 198. They should plan to put 50% more money at level of 140/150. At 150 short term investors can hope to reap Rs 100 as profit.
Syndicate Bank
Buy Syndicate bank only at 47. At the present level it is an absolute NO even for short term gains. At 47 one has to book quick profits. It can be considered for actual buying only at around 30.
IDBI
IDBI can be considered for buying only at 40 and may even drift down to 30. So 50% money should be used for buying at level of 40 and rest 50% should be used for buying at the level of 30. At present level it is too weak to look for any buying opportunity.
Wednesday, February 25, 2009
INDIAN MARKETS Feb 2009 : PVT BANKING SECTOR - BUYING OPPORTUNITIES
Banking Sector is under tremendous pressure. What is more disturbing is the fact that the Pvt Sector banks are in for a hard hit. They are the ones that we have so far been very bouyant about. And that is reflected in their P/E ratios. While the best P/E in Public Sector Bank is of State Bank of India(7.95), the top honours in Pvt Sector banks is with Kotak Mahindra bank with a P/E of 36.03 , followed by HDFC bank with P/E of 17.61. That simply hints that there is going to be some serious price correction in pvt sector banks.
Let us analyse some of the important pvt sector banks for fabulous buying opportunities they are going to present to us in near future. Our focus will be to assess the buying price of these banks for short and long term investments. In other words we shall formulate buying strategies for some terrific opportunities expected to be thrown at us by Pvt Banking Sector in days ahead.
ICICI Bank
ICICI bank has very little support around 300 and so short term investors can enter at around 300 for booking quick profit of Rs 50/60. Long term investors can invest 25% at this level.
If ICICI bank breaches 283, one can safely look for a buy at 216. At this level short term investors can look to pocket a profit of Rs 100. Long term investors can pump in another 50% money at this level.
HDFC Bank
Short term investors can look to enter HDFC bank at 800 but should be nimble footed and book quick profit of Rs 70/80. Long term investors can put 25% of their investment at level of 800.
If HDFC bank breaches 800 then buy it not before 595. Short term investors can then take profit up to Rs 200. Long term investors should put in another 50% of their money at this level.
Kotak Bank
Buy Kotak Bank not before 225. Then also it may touch 200 in intra-day move. At present just stay away from Kotak Bank.
Axis Bank
Buy Axis bank only at 230. At the present level it is rather dangerous to venture into it even for short term gains.
IndusInd Bank
IndusInd Bank can be considered for buying only at 20. It is going to make a violent dash for the level of 20 and hence cannot be bought at present even for short term profit.
Let us analyse some of the important pvt sector banks for fabulous buying opportunities they are going to present to us in near future. Our focus will be to assess the buying price of these banks for short and long term investments. In other words we shall formulate buying strategies for some terrific opportunities expected to be thrown at us by Pvt Banking Sector in days ahead.
ICICI Bank
ICICI bank has very little support around 300 and so short term investors can enter at around 300 for booking quick profit of Rs 50/60. Long term investors can invest 25% at this level.
If ICICI bank breaches 283, one can safely look for a buy at 216. At this level short term investors can look to pocket a profit of Rs 100. Long term investors can pump in another 50% money at this level.
HDFC Bank
Short term investors can look to enter HDFC bank at 800 but should be nimble footed and book quick profit of Rs 70/80. Long term investors can put 25% of their investment at level of 800.
If HDFC bank breaches 800 then buy it not before 595. Short term investors can then take profit up to Rs 200. Long term investors should put in another 50% of their money at this level.
Kotak Bank
Buy Kotak Bank not before 225. Then also it may touch 200 in intra-day move. At present just stay away from Kotak Bank.
Axis Bank
Buy Axis bank only at 230. At the present level it is rather dangerous to venture into it even for short term gains.
IndusInd Bank
IndusInd Bank can be considered for buying only at 20. It is going to make a violent dash for the level of 20 and hence cannot be bought at present even for short term profit.
Tuesday, February 24, 2009
JAI HO! SLUMDOG MILLIONAIRE
Jai Ho ! This seems to be the preferred greeting for many Indians across the globe. And why not? These two words are ringing in every Indian's ears , resonating from deep within. Jai Ho Danny Boyle, Jai ho A R Rahman, Jai Ho cast and crew of Slumdog Millionaire , and Jai ho 81st Academy Awards!!! What a wonderful gift to the Indian Film Industry! Eight Oscars to a basically Indian film is how it is being perceived. And why not, why ever not. Though the film is technically a British film, it has maximum participation of Indians. Various other reasons why it should be hailed as an Indian film are enumerated below. Take a critical look :-
- The film is based on a novel titled Q&A by an Indian diplomat-cum-part-time writer Vikas Swaroop.
- Total cast of the movie is of Indian origin.
- Co-director of the movie is a Delhi girl , Loveleen Tandon.
- The film is completely shot in India.
- The quintessence of the movie is Indian.
- A third of the movie is in Hindi.
- Director Danny Boyle confessed that, "it is the ultimate compliment for me that people in India see Slumdog Milionaire as an Indian film."
- Most technicians are Indians including Oscar winner for sound mixing -Resul Pookutty.
- All songs in the movie are in Hindi.
- Vanity Fair magazine recently mentioned that Slumdog Millionaire is inspired by Black Friday and Satya - both Hindi movies. Even Danny Boyle acknowledged that.
There are many more subtle reasons. The list goes on and on. The film is entirely a Bollywood genre film with its unique masala and that is undisputed. The scene of the two small kids falling off the running train and getting up as grown up kids is typically Bollywood. We have seen all that in many a Hindi film. So when the soul and the body is Indian one cannot but submit that Slumdog Millionaire is essentially an Indian film. More so when even the inspiration for the movie is two Hindi films - Black Friday and Satya.
In saluting the Indian spirit of the movie, Hollywood's Kodak Theatre resounded with the beats of Jai Ho and O Sayya with Western dancers in dazzling pink Indian Lehnga costume and drummers in traditional Indian dhoti. The audience swayed to the lilting Indian melody spun by A R Rahman.
It is reported that Times Square has people testing their lungs singing O Sayya at the top of their voice. Jai Ho already has a remix version in English, sung by Pussycat Dolls and the video is filmed at a Vienna Railway station.
So why are critics in India so confused. Why are we so perturbed that the underbelly of Mumbai has been exposed? Some have even accused that poverty in India has been showcased to Western audiences for exploitation. I fully agree with Aupam Kher when in a TV show he remarked that maybe some critics take on the task of criticising Slumdog Millionaire just to be noticed. Consider the following points and make your own decision :-
- The film is based on lives of two kids from a slum in Mumbai. So what is the big deal? Doesn't every developing country has this problem of slums. Favelas of Brazil and the slums around them are very well known to the world for their abject poverty and crime. Kibera in Nairobi is the largest slum of the world and conditions there are pathetic to say the least. In fact one third of world's urban population lives in slums!
- Poverty has not been underlined in Slumdog Millionaire. In fact it is the human spirit which has been showcased. Where do you see poverty as the central theme in the movie? On the other hand the movie highlights the fact that two kids with imagination and courage make it on their own in cities of India. Poverty is nothing new to the Western audiences. They see actual poverty in images from Africa and war devastated countries. What has been shown in the movie is nothing in comparison to actual poverty existing in today's world.
- Flash back to 1970s and you find Indian parallel cinema actually showcasing abject poverty in India in good measure. The central theme of those movies was poverty in India. Those movies and their directors were hailed by the same critics as they took those movies to world fora for recognition and acclaim. Why the double standards now when poverty is not the main theme of Slumdog Millionaire. It is simply a rags to riches story with adequate dose of Bollywood masala.
Now just look at what Slumdog Millionaire has done to the Indian Film Industry. In this Economic Downturn when the poster boys of Indian Industry are busy protecting themselves from being wiped out, here is the Indian Film Industry which is going to be hugely benefited by Slumdog Millionaire. Sample the facts below:-
- World has recognised the talent of Indian technicians in film making. As cost cutting measure, work from Hollywood will now be outsourced to India. This will be similar to the saga of IT outsourcing to India.
- Indian producers have now realised that with few changes to Bollywood masala that they churn out, they can now target world audience. Acceptance is not an issue, only if the Indian curry is not too spicy for global audience. This fact has been amply brought home by Slumdog Millionaire.
- Instead of targeting 2% Revenue, Indian Film Industry can now target the rest of the 98% Revenue that the Global Film Industry has to offer. Just imagine the scaling-up that this Indian Industry can get, only at the cost of slightly shifting its focus to global audiences and their preferences. Slumdog Millionaire has not only shown but opened up that door for Indian Film Industry.
- Joint ventures will spawn as global producers see the magic of Indian Film Industry, right up to its song and dance sequences, being heartily lapped up by global audiences. Just sample the bottom line of Slumdog Millionaire- the film has already raked in $163 million in box office against a budget of $15 million. Doesn't it make pure business sense?
Yet there are people in India who are not happy with Slumdog Millionaire. You decide whether Slumdog has been a blessing in disguise for India or not. Indian Film Industry is poised to take the place of Indian IT industry, courtesy Slumdog Millionaire. Let us all celebrate. Jai Ho!
Sunday, February 22, 2009
INDIAN MARKETS Feb 2009 : Disaster Looming Large
Are you being led to believe in the stories of recovery of Indian Industry? Of expected turn around tales in the fortune of Indian companies from here on? If you are an investor in the Indian Stock Markets then take all these stories with a pinch of salt. Do not make hasty investment decisions based on such dubious news flows. Do evaluate the reasons given below and then take an informed decision.
Apparent Trend of Nifty
Any one will confirm that Nifty is precariously poised to gravitate lower from the close of 20 Feb 2009. Check out all important Indicators if you may. Every Indicator of any consequence is telling you to stay away from Nifty if you are contemplating buying.
Take a look at MACD. Since it is neither purely a lagging nor purely a leading indicator, it is specially helpful in the present time of non- trending market. In other words MACD will work with a greater degree of accuracy in times of sideways movement of market. And MACD clearly indicates that Nifty is headed southwards.
What about Commodity Channel Index or CCI in short? It confirms what MACD is telling us. Indicators like ROC and Momentum have a similar outlook. RSI is non committal as expected in sideways market movements . It is therefore seen between the band of 30 and 70 since Nov 2008 - time during which Nifty has moved sideways. Only slow stochastic gives us a hint that the Nifty is in Oversold Zone and may spring up.
Chances of Nifty Moving Up
Even though all Indicators are in conformity to Price movement in the Charts, let us analyse the chances of Nifty moving up from the closing price of 20 Feb 2009 which has been indicated as a probability in Slow Stochastic. Nifty is trading in a very narrow Bollinger Band . In this constricted band Nifty is confined between the lower limit of 2660 and upper limit of 2970. The peculiarity of constricted Bollinger Band is that if upper or lower limits of the Band are breached then there is a violent breakout in the same direction. That means for Nifty to move upwards it has to first breach the level of 2970. And for Nifty to move decisively southwards it has to breach the level of 2660. On 20 Feb 2009 Nifty close at 2736. Now you tell me - what is more probable? Obviously it will be much easier for Nifty to breach 2660 than breach 2970 from the closing of 2736. With this bit of knowledge, you can make your own decisions for the chances of Nifty moving up from here!!
What Sectors Say
Analysis of different Sectors reveal that they are in dire straits to say the least. Every Sector is telling the investor to run for cover. But the irony is - now there is very little cover left to even hide. The adorable Sectors are going to be worst hit. IT Sector gave indications of accelerated fall on 17 Feb 2009 itself. Banking Sector gave clear and confirmed signals of massive fall ahead on 20 Feb 2009. Auto and Metals are dangerously dangling as if on a slender thread. Infrastructure and Realty are also poised to slide. Capital Goods Sector is feeling the heat. Pharma is in no better situation. Fertilizer Sector and Textile Sector are tottering at the brink of disaster. There is no respite even for Media and Telecom Sectors.
Power Sector and Cement Sector are slightly better off - in a more comfortable position than the Sectors discussed so far. Even Sugar Sector can claim some degree of respectability . FMCG Sector and Oil Sector are presently enjoying the most stable position.
Wrap Up
No wonder Nifty is exhibiting such weakness!! Majority of our Sectors are buckling under tremendous pressure and are on the verge of collapsing into a heap. What with no real help forthcoming from the Budget, it is no surprise that Nifty is headed towards the level of 1750. This I had already predicted in my earlier post of Jan 2009 titled " Stock Market Bottom- Revelations". That prediction was mostly based on Elliot Wave and Fibonacci calculations which is now being corroborated by Price movement, all Indicators, Bollinger Band and the Sector analysis. Now it is up to the investors to decide whether they still have the heart to buy the story of Recovery of India Inc.
Apparent Trend of Nifty
Any one will confirm that Nifty is precariously poised to gravitate lower from the close of 20 Feb 2009. Check out all important Indicators if you may. Every Indicator of any consequence is telling you to stay away from Nifty if you are contemplating buying.
Take a look at MACD. Since it is neither purely a lagging nor purely a leading indicator, it is specially helpful in the present time of non- trending market. In other words MACD will work with a greater degree of accuracy in times of sideways movement of market. And MACD clearly indicates that Nifty is headed southwards.
What about Commodity Channel Index or CCI in short? It confirms what MACD is telling us. Indicators like ROC and Momentum have a similar outlook. RSI is non committal as expected in sideways market movements . It is therefore seen between the band of 30 and 70 since Nov 2008 - time during which Nifty has moved sideways. Only slow stochastic gives us a hint that the Nifty is in Oversold Zone and may spring up.
Chances of Nifty Moving Up
Even though all Indicators are in conformity to Price movement in the Charts, let us analyse the chances of Nifty moving up from the closing price of 20 Feb 2009 which has been indicated as a probability in Slow Stochastic. Nifty is trading in a very narrow Bollinger Band . In this constricted band Nifty is confined between the lower limit of 2660 and upper limit of 2970. The peculiarity of constricted Bollinger Band is that if upper or lower limits of the Band are breached then there is a violent breakout in the same direction. That means for Nifty to move upwards it has to first breach the level of 2970. And for Nifty to move decisively southwards it has to breach the level of 2660. On 20 Feb 2009 Nifty close at 2736. Now you tell me - what is more probable? Obviously it will be much easier for Nifty to breach 2660 than breach 2970 from the closing of 2736. With this bit of knowledge, you can make your own decisions for the chances of Nifty moving up from here!!
What Sectors Say
Analysis of different Sectors reveal that they are in dire straits to say the least. Every Sector is telling the investor to run for cover. But the irony is - now there is very little cover left to even hide. The adorable Sectors are going to be worst hit. IT Sector gave indications of accelerated fall on 17 Feb 2009 itself. Banking Sector gave clear and confirmed signals of massive fall ahead on 20 Feb 2009. Auto and Metals are dangerously dangling as if on a slender thread. Infrastructure and Realty are also poised to slide. Capital Goods Sector is feeling the heat. Pharma is in no better situation. Fertilizer Sector and Textile Sector are tottering at the brink of disaster. There is no respite even for Media and Telecom Sectors.
Power Sector and Cement Sector are slightly better off - in a more comfortable position than the Sectors discussed so far. Even Sugar Sector can claim some degree of respectability . FMCG Sector and Oil Sector are presently enjoying the most stable position.
Wrap Up
No wonder Nifty is exhibiting such weakness!! Majority of our Sectors are buckling under tremendous pressure and are on the verge of collapsing into a heap. What with no real help forthcoming from the Budget, it is no surprise that Nifty is headed towards the level of 1750. This I had already predicted in my earlier post of Jan 2009 titled " Stock Market Bottom- Revelations". That prediction was mostly based on Elliot Wave and Fibonacci calculations which is now being corroborated by Price movement, all Indicators, Bollinger Band and the Sector analysis. Now it is up to the investors to decide whether they still have the heart to buy the story of Recovery of India Inc.
Saturday, January 31, 2009
STOCK MARKET BOTTOM - REVELATIONS
A new breed of hunters has arrived on the scene. The bottom hunters of 21st Century! Across the globe this breed is burning the proverbial midnight oil to fervently hunt for bottom in all markets. Here is a spot of good news for this beleaguered lot. The Bottom Has Been Found. Feast your eyes below!
Dow Jones Industrial Average
For bottom hunters of American market, the most wonderful news is that the bottom has already been reached. Dow Jones Industrial Average(DJIA) had reached the bottom at the level of 7400. Without violating this level, from here on the assured upswing will take DJIA to 9600 level. This means that short term investors can pump in money at 8000 level to reap benefits till DJIA reaches 9600. At this level it will be prudent to book profits for all shades of investors. The percentages of profit to be booked will be the differentiators between short, medium and long term investors. Short term investors should book 100% profit at 9600 level, whereas medium term investors should book 50% profit. Investors with a long term view should book at least 30% profit, if not more. But in all fairness DJIA has the potential to reach 10300. So after booking profits at 9600 one should be on the look out for clear buying signals around 8800.
The pertinent question that arises is - how have I arrived at this conclusion of the bottom? Well in DJIA charts, if we take the wave top around mid May 2008 the value is 13100 and the bottom is at 10800 around mid July 2008. That's the first leg of the wave. By that count if we apply Elliot Wave Theory, the pullback should have taken it to the level of 11700. However in actuality DJIA pulled back to 11800 in the beginning of Aug 2008. For the second leg of the wave, downturn from 11800 should have taken DJIA to level of 8100 as per calculations. In reality DJIA reached 8150 in the last week of Oct 2008. The pullback from here should have reached 9550 but on ground DJIA reached 9700 at the start of Nov 2008. As per Elliot Wave Theory the third and final leg of this wave should have culminated at 7450 , and so it did in the last week of Nov 2008. Completion of the wave starting at level of 13100 and terminating at 7450 signifies that a minimum upswing of 38.2% is guaranteed from the bottom of 7450. And that upswing should safely take DJIA to 9600.
NIFTY
Shifting focus to Indian market, one has to announce with a heavy heart that the bottom has still not been reached. The bottom will be reached around 1750 as per Elliot Wave calculations, and that is the most terrifying thought. Downhill journey of Nifty that began from the top of 6357, reached on 08 Jan 2008, has yet to see its logical bottom. If Nifty fails to conquer 3150 in the near term , then we shall see Nifty touch 1750 first. But in case Nifty manages to pullback above 3150 then it will go up to 3450. In such an eventuality the Nifty bottom will be formed at 1970. On a more simplistic note, Nifty bottom is expected to be formed in the range of 1750- 1970. The trouble is that this bottom is also not a long term bottom, but in a bear market it will be substantial enough for the Bulls to rejoice. The reason is simple. The assured pullback from such a bottom is 1400 Nifty points. This pullback has even the potential to notch up 1800 Nifty points. Reason enough for the bulls to say CHEERS!
Let me be honest with you. I have not given detailed explanations for the points in preceding paragraphs. I believe that detailed calculations on the above predictions may confuse some of my readers. However if anyone desires to seek detailed calculations on the expected movement of indices discussed, I shall only be glad to oblige. Do feel free to seek clarifications on the denouement . I shall also be unfolding the suspense on specific sectors and stocks in these pages, so do keep a look-out for the same.
Dow Jones Industrial Average
For bottom hunters of American market, the most wonderful news is that the bottom has already been reached. Dow Jones Industrial Average(DJIA) had reached the bottom at the level of 7400. Without violating this level, from here on the assured upswing will take DJIA to 9600 level. This means that short term investors can pump in money at 8000 level to reap benefits till DJIA reaches 9600. At this level it will be prudent to book profits for all shades of investors. The percentages of profit to be booked will be the differentiators between short, medium and long term investors. Short term investors should book 100% profit at 9600 level, whereas medium term investors should book 50% profit. Investors with a long term view should book at least 30% profit, if not more. But in all fairness DJIA has the potential to reach 10300. So after booking profits at 9600 one should be on the look out for clear buying signals around 8800.
The pertinent question that arises is - how have I arrived at this conclusion of the bottom? Well in DJIA charts, if we take the wave top around mid May 2008 the value is 13100 and the bottom is at 10800 around mid July 2008. That's the first leg of the wave. By that count if we apply Elliot Wave Theory, the pullback should have taken it to the level of 11700. However in actuality DJIA pulled back to 11800 in the beginning of Aug 2008. For the second leg of the wave, downturn from 11800 should have taken DJIA to level of 8100 as per calculations. In reality DJIA reached 8150 in the last week of Oct 2008. The pullback from here should have reached 9550 but on ground DJIA reached 9700 at the start of Nov 2008. As per Elliot Wave Theory the third and final leg of this wave should have culminated at 7450 , and so it did in the last week of Nov 2008. Completion of the wave starting at level of 13100 and terminating at 7450 signifies that a minimum upswing of 38.2% is guaranteed from the bottom of 7450. And that upswing should safely take DJIA to 9600.
NIFTY
Shifting focus to Indian market, one has to announce with a heavy heart that the bottom has still not been reached. The bottom will be reached around 1750 as per Elliot Wave calculations, and that is the most terrifying thought. Downhill journey of Nifty that began from the top of 6357, reached on 08 Jan 2008, has yet to see its logical bottom. If Nifty fails to conquer 3150 in the near term , then we shall see Nifty touch 1750 first. But in case Nifty manages to pullback above 3150 then it will go up to 3450. In such an eventuality the Nifty bottom will be formed at 1970. On a more simplistic note, Nifty bottom is expected to be formed in the range of 1750- 1970. The trouble is that this bottom is also not a long term bottom, but in a bear market it will be substantial enough for the Bulls to rejoice. The reason is simple. The assured pullback from such a bottom is 1400 Nifty points. This pullback has even the potential to notch up 1800 Nifty points. Reason enough for the bulls to say CHEERS!
Let me be honest with you. I have not given detailed explanations for the points in preceding paragraphs. I believe that detailed calculations on the above predictions may confuse some of my readers. However if anyone desires to seek detailed calculations on the expected movement of indices discussed, I shall only be glad to oblige. Do feel free to seek clarifications on the denouement . I shall also be unfolding the suspense on specific sectors and stocks in these pages, so do keep a look-out for the same.
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