Analysis to find trading opportunities in the coming week. We will be using technical analysis through the triple screen trading system to find trades in the coming week.
This effort will be a continuous activity with weekly updates. As I do analysis for my trades, I thought sharing it will help a few other aspiring traders as well bring a commitment in me to do the activity with discipline, which will enhance my trading skills.
Let’s begin with the broad market view. How is SENSEX & NIFTY?
Both SENSEX & NIFTY have scaled past their historic peak levels. SENSEX moved to a new high while NIFTY fell short a shade lower after crossing 12K. The current uptrend in price of both the indices have gained strength, where indicators are showing signs of further continuation of upward price move.
This said, it will not have a straight upside. In making it to the current levels 40K & 12K, both the indices have got tired and began their correction before getting to the next rally. Now, here is an opportunity for going long on Nifty.
Rating downgrade by Moody’s should take the indices down. Nifty can reach 11700 levels before making the next upside attempt.
How the industry groups are positioned?
Of the total 115 industry groups 65 are Bullish and 50 are bearish, so we can see a clear shift of the market to bullish direction. The concern here is that, out of 65 bullish industries, 47 are yet to show strength. And out of 50 bearish industries 38 are strong on the downside.
Now we get another confirmation for the correction that has began in the markets from 8th November. Bears are still showing some strength, after the correction that is going on now, some of the 38 will move up to the bulls side. By that time from the 47 bullish industries that are not strong yet will gain strength.
Now it is time for some shorts.
On the weekly charts the following stocks have a potential for short trades. Canara Bank, Lic Housing Finance, Piramal Enterprises & Cipla.
When market goes down and ticks up, there are potential for long trades in Container Corp, Divis Labs, BEL, HPCL & Mahanagar Gas