1 Weekly Technicals

August 17, 2015

Weekly Technical

Research AnalystsResearch AnalystsDharmesh Shah [email protected] Kunte, CMT [email protected] Dagha [email protected] Mukherjee [email protected] Parmar vinayak parmar@icicisecurities comVinayak Parmar [email protected]

Benchmark indices settled marginally lower after an extremely volatile trading week amid global equity rout after China devalued its currency. The Sensex closedat 28067, down 173 points or 0.6% while the Nifty settled at 8518, down 46 points. Broader markets underperformed benchmarks as the BSE midcap and small

i di d d i d b 0 9% d 2 8% ti l It fl t fit b ki ft th k f t f

Current consolidation augurs well for next up move towards 8850…

cap indices ended in red by 0.9% and 2.8%, respectively. It reflects profit booking after three weeks of outperformanceThe weekly price action formed a long legged Doji with larger lower shadow indicating buying support near 8300 even as consolidation continues for a fourthweek in a range of 8654 - 8300. The four week consolidation post July highs of 8654 has retraced preceding five week rally (7940-8654) only by 50% highlightinga robust price structure. The ongoing consolidation is expected to act as the launch pad for the next up leg. Post conclusion of current healthy consolidation, weexpect the index to take out July highs of 8654 and head for 8850 in coming weeks.

NSE Nifty Weekly Candlestick Chart• Our contention of a range bound index based on lack of faster retracement NSE Nifty Weekly Candlestick ChartOur contention of a range bound index based on lack of faster retracementon either sides held true last week. Despite sharp declines in the first threedays of the week, the Nifty held above lower range of consolidation at 8300despite highly volatile global equity markets

• Since June lows of 7940, the index has not corrected for more than three tofour sessions in a row. It maintained this tendency and made a sharp u-turnon Friday retracing four day decline by over 61.8% in a single session

9119

8844

8654

Support: 8500, 8430

Resistance: 8654, 8730

• Corrective consolidation over the last four weeks is seen as a higher basebuilding process, which has also helped markets to work off the highlyoverbought conditions developed after the 9% rally (7940 to 8654)

• Another significant observation is that last week’s correction (284 points)was lower in magnitude compared to preceding one (333 points) whichdescribes contracting price action and inherent strength. Going forward,current rally off last week’s lows of 8338 extending beyond 8638 (making it

799779407961

Sh hif dy g y ( g

bigger than the preceding one (8321-8621=300 points)) will conclude end ofcontraction since last one month and break out from consolidation sinceMay 2015 opening upsides towards 8850 levels

• The confluence of 80% retracement of the entire correction from March toJune 2015 (9119 to 7940) near 8850 makes this a key short-term hurdle forthe index, going forward

F h t t ti b li th b f th i d h hift d

Short term support shiftedupwards to 8300

52 week EMA

• From a short-term perspective, we believe the base for the index has shiftedupwards to the 8300 region, which is the confluence of the 50% retracementof the entire up move from June 2015 bottom of 7940 to July 2015 high of8654 at 8300, the rising 200 day EMA currently placed at 8285 and lows ofpast six weeks placed at 8315

• Among oscillators, the weekly RSI is seen consolidating in positive territoryin a narrow band of 50-55 readings indicating range bound markets

Weekly RSI sustained above its 9 period average despiterecent cool off highlighting the underlying strength

2

• Sectors of the week: We expect auto, capital goods and IT space tooutperform in the coming week, while metal continues to underperform Source: Bloomberg, ICICIdirect.com Research

Deal Team – At Your ServiceBank Nifty (18791): Bias remains positive above 18000 mark…

• Bank Nifty futures ended marginally lower after a volatile trading week. CNX Bank Nifty Weekly Candlestick Chart20934

Near month futures settled at 18791, down 188 points or 0.99% week onweek

• The weekly price action formed a long legged Doji with a longer lowershadow indicating buying support near 18000. Going forward, the biasremains positive above 18000

• The index is seen trading in a range of 18000-19200 over past four weeksi d fi k ll b j 50% F l i

Bank Nifty continued itsconsolidation above 18000 levels

20934

19280

as it retraced a five week rally by just 50%. From a structural perspectivethis consolidation is seen constructive. A faster retracement above 19200would signal end of consolidation and resumption of up trend

• The index held 18000 despite volatile global market conditions and made asharp u turn on Friday. It retraced four days of decline by over 61.8% in asingle day. It needs to break decisively above 19200 to reignite bullishmomentum. Such a break-out would create room for a further upward

50%

pmove in the coming months.

• After ongoing consolidation, we expect the index to resume its risingtrajectory and gradually head towards 20000 over the coming few months.The 80% retracement of the March-June decline from 20740 to 17138 isaround 20000. This also coincides with the overhead trend line joining thehighs of January 2015 (20934) and March (20740) placed around 20000levels

52 week EMA

17138

levels

• Among oscillators, the 14 week RSI took support at its nine period averageduring recent decline and has rebounded from thereon highlightingunderlying strength in the trend and indicates continuation of the upwardmomentum in the coming weeks.

• The key barriers for Bank Nifty May future in the coming week are placedat 19050 19300 whereas 18200 17950 are key supports

RSI took support at is 9 period average highlighting underlying strength in the trend

at 19050, 19300 whereas 18200, 17950 are key supports

3

Source: Bloomberg, ICICIdirect.com Research

Deal Team – At Your ServiceTrend Scanner

Positive Trends Candlestick PatternScrip Name Close 50 days EMA 100 days EMA Delivery % 5 days Averge

Bank of Baroda 184.4 165.0 166.0 41.00

Strides Arcolab 1,301.8 1,230.0 1,163.0 38.00

TCS 2,703.2 2,560.0 2,556.0 71.00

Divis Lab 2,183.0 1,938.0 1,872.0 43.00

Eicher Motors 20 600 0 19 629 0 18 516 0 37 00

Bullish Candlestick Formations Bearish Candlestick Formations

Scrip Name Pattern name LTP Scrip Name Pattern name LTP

JB Chemical Engulfing Bull 263.8 BPCL Engulfing Bear 873.8

Sonata Software Engulfing Bull 160.6 Cox & Kings Evening Star 259.0

Reliance Inds Hammer 967.0 Hindalco Continuous 93.2

Divis Lab Continuous 2183.0 Just Dial Continuous 1018.9

Negative Trends

Eicher Motors 20,600.0 19,629.0 18,516.0 37.00

Scrip Name Close 50 days EMA 100 days EMA Delivery % 5 days Averge

Just Dial 1,018.9 1,112.1 1,168.0 36.00

Hindalco 93 2 110 0 119 0 35 00

Divis Lab Continuous 2183.0 Just Dial Continuous 1018.9

Infosys Continuous 1149.3 Tata Steel Continuous 237.6

PNB Continuous 166.3 UBL Continuous 961.8

Voltas Hammer 315.3

TCS Continuous 2703.2

Legend

Hindalco 93.2 110.0 119.0 35.00

Legend

Positive and Negative Trends:

The stocks listed in the positive and negative trends section above have been identified after running multiple technical queries based on combination ofvarious technical parameters applied on a group of NSE cash stocks. The query modules are designed to recognise stocks, which are either at attractivetechnical entry levels based on overall price structure or resolving out of medium term consolidation. Consequently the query modules are also aimed atidentifying the stocks which are under performers or in established down trends and therefore may not be good bets from short to medium term perspective.

Candlestick patterns:

Candlestick formations on weekly time interval charts typically point towards the prevailing sentiment comprising the entire trading week and could prove asan important tool for short term traders. By themselves, the patterns do not carry any price target but only an indication of change in market behaviour. Moreimportance needs to be given to the placement of the pattern within larger trend. A more detailed description of Candlestick patterns and the way tounderstand them is listed at the end of the report

4


Market Activity

Gl b l M k ts Domestic Sectoral Indices PerformanceGlobal Markets Domestic Sectoral Indices Performance

47,508.4

UK

Brazil

2,091.5

-2.2%

0.7%US China

20,519.5

3,965.35.9%

Japan -1.0%

Hong Kong23,991.0 6,550.7

INDICES Current 1Wk 1M 3MSensex 28067.31 -0.6 -2.0 1.1Nifty 8518.55 -0.5 -2.1 1.5Auto 19461.68 -1.5 -0.5 1.1Banking 21488.24 -1.0 -3.0 0.4Capital goods 17955 01 -2 4 -2 5 9 1

Global Currencies, Commodities & Bond Yields

UK -2.5%

Hong Kong

France-3.8%

4,956.5

-2.3%

Germany -4.4%

10,985.1

Capital goods 17955.01 2.4 2.5 9.1

Cons durables 11264.44 -1.3 1.4 11.0FMCG 7923.25 -2.7 -2.9 2.3Healthcare 18058.72 3.1 3.9 7.7IT 11621.55 4.1 4.4 9.2Metal 7806.25 -10.0 -11.2 -22.3Oil & gas 9507.63 -4.6 -4.8 2.1

65 01 96 66Power 2012.31 -2.5 -3.9 -2.0Realty 1429.03 -0.6 -4.3 -14.1BSE 500 11236.11 -1.1 -0.6 2.6BSE midcap 11453.78 -0.9 -0.7 7.2BSE small cap 11766.78 -2.8 -2.2 6.4

Japanese Yen 124.35 Swiss Franc 0.98

0.0% -0.5%

Euro1.11

British Pound1.56

1.2% 1.0%

Rupee (|)65.01

Dollar Index96.66

-1.9% -1.0%

Nifty Gainers / Losers for the week (%)5.9 5.8 5.4 4.9

-9.3 -9.7 -15.0 -17.2-3.50

4.50

% C

hang

e2.19

India 10 year US 10 Year7.75

Copper (tonne)5,157.25

2.1% -0.1%

Brent Crude/barrel 48.60

Gold/ounce1,116.60

Silver (ounce) 15.3

0.4% 2.8%

-19.50

-11.50

TCS

LUPI

N

SUN

PHA

RMA

INFY

TATA

STEE

L

TATA

MOT

ORS

HIN

DALC

O

VEDL

%

0.39

-1.4 bps

1 bps

EURO 10 Year JPY 10 Year

India 10 year US 10 Year-6.5 bps

0.66

-0.1 bps

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Deal Team – At Your ServiceMarket ActivityInstitutional flow trends of last 12 months

1

1677

880

4309

3940 92

44

2 28000

29000

30000

9000

14000

19000Series2 Series1 Series3

5103

-117

2

1375

3

2132

1291

9

1147

6

1207

8 1172

1

-576

8

-334

4

5319

-117

5

4172

5940 70

37

4177

1032

6 544

217

25000

26000

27000

-6000

-1000

4000

9000

Weekly market breadth trends

250006000

Sep'

14

Oct'1

4

Nov

'14

Dec'

14

Jan'

15

Feb'

15

Mar

'15

Apr

'15

May

'15

June

'15

July

'15

Aug

'15

% % % %% % % % % %

27316 2781228093 27661

28463 28112 28115 28236 28067

26500

28000

29500

40%

60%

80%

cent

age

Advance % Decline % Sensex

58%

53%

55% 54

%

57%

51% 54

%

56%

44%

42% 47%

45% 46%

43% 49%

46%

44%

56%

23500

25000

0%

20%

19-Jun-15 26-Jun-15 3-Jul-15 10-Jul-15 17-Jul-15 24-Jul-15 31-Jul-15 7-Aug-15 14-Aug-15

Perc

Week Ended

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Deal Team – At Your ServiceDow Jones (17477): Index taking support near December 2014 and February 2015 Lows…

• The DJIA ended up 0.6% after an extremely volatiletrading week. The index recovered after mid-weekdecline as China devalued its currency resulted in asharp sell off in global equity. DJIA ended at 17477,up by 104 points or 0.6% for the week

• The weekly price formed a High wave candle with all l b d d l h d i ith

Dow Jones Industrials Weekly Bar Chart

Index is seen trading in the broad range of 17000-18300 for the last eight months. The Index sustainingabove 17000 levels bias remain positive and currentconsolidation is seen as a base formation

18351

small real body and a long shadows in eitherdirection indicating intra week volatility. The indexduring the week bounced back taking support nearthe lows of December 2014 and February 2015placed near 17000 levels

• The DJIA for the last eight months is seenconsolidating in the broad range of 17000-18300

consolidation is seen as a base formation

100 Weeks EMA

17037

15855

16588

g glevels. A decisive breach of the range will indicateweaken the price structure in the short term. Longterm uptrend remain intact as the index continuesto form higher high and high low in long term chartsand continue to trade in a rising channel as can beseen in the adjacent chart

• The index has witnessed consistent buying support

100 Weeks EMA

• The index has witnessed consistent buying supportnear ~ 17000 over the past eight months. Keysupport is marked by confluence of the lower bandof rising trend channel and 100-week EMA (16910).The Index sustaining above 17000 levels biasremain positive and current consolidation is seen asa base formation for the next up move

A ill h kl RSI i i i

RSI is seen trending down and is placed at its supportzone of 40-45 reading12472

• Among oscillators, the weekly RSI is seen sustainingabove the bull market support level of 40 and urgeswell for the uptrend

• For the coming week, the DJIA has support at17300, 17125 while resistance is placed at 17630,17780

77


Deal Team – At Your ServiceGerman Dax (10985): Index trending in a downward sloping channel…

• The German equity ended sharply lower afterChina’s move to devalue the currency triggeredfears of a currency war and a resultant sell off inequities across the globe. The Dax closed the weekat 10985, down by 505 points or 4.4% for the week

• The price action for the week formed a bearishEngulfing candle at the upper band of the falling

German Dax

Weekly Candlestick Chart

The index formed a bearish engulfing candle at the upperband of the falling channel indicating indicatingextended profit booking towards 10500 levels

12390

11802

Engulfing candle at the upper band of the fallingchannel indicating corrective bias in the short-term.In the process, the index breached its immediatesupport area near 11000 indicating extended profitbooking towards 10500 levels

• We expect the current decline to hold this supportlevels of 10500 and result in a base formation for

extended profit booking towards 10500 levels

10653

the next leg of the rally to pan out. Key support of10500 is marked by the confluence of followingtechnical parameters:

• 61.8% retracement at 10540 of precedingrally(9383-12390)

• Bullish gap of 23rd January 2015 placed at10502 10434

52 Weeks EMA

9383

10502-10434

• We expect the index to resolve higher after a baseformation near 10500 mark and head towards 11800being the high of July 2015

• Among momentum oscillators, the 14-week RSI hasbreached its recent trading range indicatescorrective bias in the coming sessions

Weekly 14 period’s RSI has breached its recent trading rangeindicates corrective bias in the coming sessions

corrective bias in the coming sessions

• For the coming week, the Dax has support at 10800,10650 while resistance is placed at 11280, 11400

88


Deal Team – At Your ServiceUS$-INR (65.00): Rupee remains weak below 64…

• The rupee slipped to lowest level since September2013 as the dollar demand from banks andimporters and devaluation of Chinese Yuan earlythis week weighed on sentiments. The domesticcurrency unit closed at 63.81, up 0.5% for the week

• The US$INR pair resolved above 14 weeks tradingrange (64 30 63 30) early during the week after

US$INR

Weekly Bar Chart The Rupee remains under pressure below 64 andexpected to head towards 66.50

68.8450

range (64.30-63.30) early during the week afterChina devalued its currency triggering fears ofcurrency war. Rupee continued to slide for sevensuccessive sessions to test intra week lows of 65.34

• The channelled up trend for US dollar continues asit breaks out of three month consolidation. Goingforward, the immediate support for US dollar is

Gap @ 65.2450 - 64.5250Equality @ 66.50

63.7600

placed at break out area of 64 levels

• As detailed earlier, medium-term bias for the USdollar remains positive as long as lower band of thechannel placed at 63 is held

• US dollar has hit our target of 65 levels in last week.After sharp declines rupee may enter someb h H h d

61.0700

breather. However, we expect rupee to headtowards 66.50 levels in the medium term beingconfluence of higher band of rising channel andequality of current up leg with preceding rally

• Among oscillators, the 14 week RSI is seenresuming up trend supporting strength for US dollar

• For the coming week the US$INR support is placed

58.3350

• For the coming week, the US$INR support is placedat 64.50, 64.20 whereas resistances are placed at65.30, 65.80

99


Deal Team – At Your ServiceGold ($1116): Trend remains firmly down below $ 1160…

• Gold prices snapped seven weeks of decline afterChinese yuan depreciation raised doubts about thepace of expected interest rates hikes by US FederalReserve. Gold settled at three week highs despiteretreating off weekly high on Thursday

• The weekly price action formed a sizeable bullcandle with higher high and higher lows in response

GOLD

Weekly Bar Chart Gold prices posed pull back after seven week decline.Overall trend remains firmly down below $ 1160

candle with higher high and higher lows in responseto last two week’s Doji candles. It signals a pullbackafter seven weeks of decline led prices to over soldterritory

• The bullion witnessed a pull back after seven weeksof decline which is seen as counter trend corrective.However, the overall trend remains weak. We

1434

1392

1307believe any pullbacks from current oversold statewill be short-lived and would not last beyond$1160. We believe the recent break down area andmultiple lows formed in 2014-15 around $1140 willreverse its role and act as resistance

• As highlighted in the earlier edition, the violation ofyearly low of 2014 has signalled a weakening price

1307

1181$253 fallyearly low of 2014 has signalled a weakening pricestructure and has the portents of further downslideover the coming months. Structurally, the last twomajor falling segments in 2013 and 2014 measuredaverage $257 points. We expect the current fallfrom January 2015 high of $1307 to equal themagnitude of the 2013 and 2014 falling segmentsthereby projecting downsides towards $1050 levels

2014 low@ 1130

$262 fall

The 14 week RSI seen bouncing off oversold readings, however overall trend remains down

y p j gover the coming months

• Among oscillators, the 14 week RSI remains indownward trajectory after registering a breakdownbelow its long term rising trendline connectingmajor troughs of 2013 and 2014 indicatingcontinued downward bias

1010


Deal Team – At Your ServiceBrent Crude ($49.5): Consolidation likely after seven week decline…

• Brent crude snapped six weeks of losing streakamid US dollar weakness. For the week, crude oilended 2% positive

• The weekly price action formed a Harami candle asprices traded within prior week’s high-low range ($52-48.5) indicating indecision after steep declines

Brent Crude Weekly Bar Chart

The crude prices may attempt a pull back after steep declines,however short term trend remains down

• As detailed in earlier edition, the decisive break andclose below the previous higher bottom of $52.50 isindicative of weakening price structure and opensthe door for a retest of the January 2015 bottom of$45 levels in the current months

• After already correcting over 30% from June highsof $69 prices may witness some range bound

63

69

of $69, prices may witness some range boundconsolidation owing to oversold state of short termindicators. However, the overall trend remainsweak. We believe the short-term upsides will remaincapped till 60 levels being the recent gap down areaand 50% retracement of the decline from $69 to$48.24 levels

A ill h kl MACD (E 12/26/9)

52.5

45

• Among oscillators, the weekly MACD (E-12/26/9)has generated a bearish crossover below its nineperiod average signalling a weakening trend andindicates continuation of downward momentum inthe near term

Bearish crossover on weekly MACD highlights the weakening structure

1111


Deal Team – At Your ServicePrevious Week’s Performance

Date Scrip Product Strategy RP Target SL Gain/Loss % Comment

Nifty Stocks Pivot points for the Week (August 17 21 2015)

p gy g17-Jul Strides Arcolab Cash Buy 1310.00 1550.00 1160.00 Open

Nifty Stocks Pivot points for the Week (August 17 – 21, 2015)COMPANY CMP PIVOT S1 S2 R1 R2NIFTY 8518.55 8492.68 8363.82 8209.08 8647.42 8776.28

SENSEX 28067.31 27988.11 27558.63 27049.95 28496.79 28926.27

ACC 1372.05 1378.68 1348.42 1324.78 1402.32 1432.58

AMBUJACEM 226 30 220 57 210 73 195 17 236 13 245 97AMBUJACEM 226.30 220.57 210.73 195.17 236.13 245.97

ASIANPAINT 895.25 891.28 866.32 837.38 920.22 945.18

AXISBANK 570.00 569.85 555.00 540.00 584.85 599.70

BAJAJ-AUTO 2558.60 2518.08 2462.52 2366.43 2614.17 2669.73

BANKBARODA 184.40 182.15 177.60 170.80 188.95 193.50

BHARTIARTL 395.10 395.90 376.35 357.60 414.65 434.20

BHEL 261 50 262 90 251 00 240 50 273 40 285 30BHEL 261.50 262.90 251.00 240.50 273.40 285.30

BOSCHLTD 25387.35 25619.07 24518.18 23649.02 26488.23 27589.12

BPCL 873.75 903.70 827.85 781.95 949.60 1025.45

CAIRN 155.70 157.20 146.10 136.50 166.80 177.90

CIPLA 739.60 722.20 714.15 688.70 747.65 755.70

COALINDIA 377.55 385.93 353.82 330.08 409.67 441.78

DRREDDY 4257 75 4253 67 4189 03 4120 32 4322 38 4387 02DRREDDY 4257.75 4253.67 4189.03 4120.32 4322.38 4387.02

GAIL 337.15 336.82 327.33 317.52 346.63 356.12

GRASIM 3703.75 3704.67 3573.08 3442.42 3835.33 3966.92

HCLTECH 973.70 964.23 939.57 905.43 998.37 1023.03

HDFC 1299.95 1294.48 1255.57 1211.18 1338.87 1377.78

HDFCBANK 1101.80 1091.45 1076.95 1052.10 1116.30 1130.80

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Source: NSE India, ICICIdirect.com Research

Nifty Stocks Pivot points for the Week (August 17 - 21, 2015)

COMPANY CMP PIVOT S1 S2 R1 R2HEROMOTOCO 2712.45 2687.18 2644.47 2576.48 2755.17 2797.88

HINDALCO 93.15 98.13 84.52 75.88 106.77 120.38

HINDUNILVR 870.55 876.52 844.03 817.52 903.03 935.52

ICICIBANK 302.60 302.23 290.47 278.33 314.37 326.13

IDEA 161.25 161.63 155.27 149.28 167.62 173.98

INDUSINDBK 959.00 941.08 924.17 889.33 975.92 992.83

INFY 1149.25 1123.88 1080.92 1012.58 1192.22 1235.18

ITC 318.15 316.13 305.02 291.88 329.27 340.38

KOTAKBANK 717.70 705.58 694.67 671.63 728.62 739.53

LT 1799.50 1797.23 1750.27 1701.03 1846.47 1893.43

LUPIN 1793.45 1749.23 1724.67 1655.88 1818.02 1842.58

M&M 1378.15 1356.03 1317.12 1256.08 1417.07 1455.98

MARUTI 4572 50 4507 50 4481 00 4389 50 4599 00 4625 50MARUTI 4572.50 4507.50 4481.00 4389.50 4599.00 4625.50

NMDC 97.25 98.75 92.50 87.75 103.50 109.75

NTPC 129.65 130.28 125.97 122.28 133.97 138.28

ONGC 270.40 273.57 262.43 254.47 281.53 292.67

PNB 166.25 160.00 157.70 149.15 168.55 170.85

POWERGRID 138.35 135.28 129.07 119.78 144.57 150.78

RELIANCE 966.95 961.72 934.63 902.32 994.03 1021.12RELIANCE 966.95 961.72 934.63 902.32 994.03 1021.12

SBIN 268.50 271.00 252.55 236.60 286.95 305.40

SUNPHARMA 897.70 872.23 856.47 815.23 913.47 929.23

TATAMOTORS 355.25 365.22 335.13 315.02 385.33 415.42

TATAPOWER 69.70 69.23 67.72 65.73 71.22 72.73

TATASTEEL 237.60 243.87 222.73 207.87 258.73 279.87

TCS 2703.20 2643.10 2602.20 2501.20 2744.10 2785.00

TECHM 555.05 549.80 532.10 509.15 572.75 590.45

ULTRACEMCO 3103.90 3121.07 3013.28 2922.67 3211.68 3319.47

VEDL 107.10 112.48 93.87 80.63 125.72 144.33

WIPRO 575.25 570.53 559.77 544.28 586.02 596.78

YESBANK 796.80 796.10 757.90 719.00 835.00 873.20

ZEEL 419.80 412.18 405.62 391.43 426.37 432.93

1313

Source: NSE India, ICICIdirect.com Research

Deal Team – At Your ServiceForthcoming Economic Events Calendar

Date EventDate Event

US17-Aug Empire Manufacturing17-Aug NAHB Housing Market Index18-Aug Net Long-term TIC Flows18-Aug Total Net TIC Flows18-Aug Housing Startsg Housing Starts19-Aug CPI MoM19-Aug CPI Ex Food and Energy MoM19-Aug U.S. Fed Releases Minutes from July 28-29 FOMC Meeting20-Aug Initial Jobless Claims/Continuing claims20-Aug Bloomberg Consumer Comfort20-Aug Bloomberg Economic Expectations20-Aug Existing Home Sales20-Aug Philadelphia Fed Business Outlook

India

25-Aug Eight Infrastructure Industries31-Aug Fiscal Deficit INR Crore31-Aug GDP YoYChina18-Aug China July Property Prices20-Aug MNI August Business IndicatorUK17-Aug Rightmove House Prices MoM/YoY18-Aug CPI MoM/YoY18-Aug RPI MoM/YoY18-Aug RPI MoM/YoY19-Aug CBI Trends Total Orders19-Aug CBI Trends Selling Prices20-Aug Retail Sales Ex Auto Fuel MoM/YoY21-Aug Public Finances (PSNCR)21-Aug Central Government NCR

1414


Deal Team – At Your ServiceNotes

Pl h d i i hi h ib d id d i h • Please execute the recommendation within the prescribed range provided in the report

• Once the recommendation is executed, it is advisable to keep strict stop loss as provided in the report on closing basis

• We adapt a trading strategy of booking 50% profit when the position is in profit by 3-5% and trail stoploss on remaining position to the entry point

• In recommendations where it is advised to buy on declines, if the target price is hit before activation of the call in prescribed range then the recommendation is considered not initiated

• The recommendations are valid only for the week and are to be squared off by the end of the week. In case we intend to carry forward the position, it will be communicated through separate mail

Trading Portfolio allocation

• It is recommended to spread out the trading corpus in a proportionate manner between the various technical research products

• Please avoid allocating the entire trading corpus to a single stock or a single product segment

Withi h d t t it i d i bl t ll t l t t h d ti• Within each product segment it is advisable to allocate equal amount to each recommendation

• For example: The ‘Daily Calls’ product carries 3 to 4 intraday recommendations. It is advisable to allocate equal amount to eachrecommendation

1515

Deal Team – At Your ServiceRecommended Product wise Trading Portfolio allocation

1616

Deal Team – At Your ServiceCandlesticks Glossary:

Candlestick patterns describe the market sentiment for the specified period Some of the formations suggest reversal of sentiment (trend) and therefore areCandlestick patterns describe the market sentiment for the specified period. Some of the formations suggest reversal of sentiment (trend) and, therefore, areimportant for a chart reader. By themselves, the patterns do not carry any price target but only an indication of change in market behaviour. More importanceneeds to be given to the placement of the pattern within larger trend

Morning Star: Potential bottom reversal pattern made of three candle lines. The first sizeable black candle reflects a market in which the bears are in completecharge. The next candle line--the small real body--shows a slight diminution of the bearish force. The white candle that makes up the last part of the morningstar visually displays the bulls are gaining the upper hand. Lowest low amongst three candles becomes technical support

Bullish Engulfing Line: A potential bottom reversal pattern This pattern typically appears at the culmination of a decline or downtrend The market falls and aBullish Engulfing Line: A potential bottom reversal pattern. This pattern typically appears at the culmination of a decline or downtrend. The market falls, and ablack candle forms (ideally a small black candle). Next, a white real body wraps around the prior session’s black body. Low of the pattern becomes short termsupport for prices

Piercing Line: Potential bottom reversal pattern. A black body forms in the downtrend. The market continues moving south on the next session’s open but thatsession culminates in a white real body that closes (e.g. pierces) than half way or more into the prior black body. Lowest low between two candles is referred toas technical support for prices

Hammer: A candlestick line which during a downtrend has a very long lower shadow and small real body (black or white) at the top end of the session’sHammer: A candlestick line which, during a downtrend, has a very long lower shadow and small real body (black or white) at the top end of the session srange. There should be no, or a very small, upper shadow. Pattern suggests buying support during declines and needs confirmation in terms of sustainability ofprices above head of the Hammer in following session

Evening Star: Potential Top reversal pattern made of three candle lines. Comparable with a traffic signal. First white candle reflects a market in bullish trend.The next candle line--the small real body—warns waning momentum. The black candle that completes the evening star visually exhibits that prior up trend hasstopped or reversed

Bearish Engulfing Line: Potential top reversal signal This two candlestick pattern emerges during a rally A black candle real body wraps around a white realBearish Engulfing Line: Potential top reversal signal. This two candlestick pattern emerges during a rally. A black candle real body wraps around a white realbody (classically a small white candle) Highest high between two candles becomes resistance level for prices for future reference

Dark Cloud cover: A dark cloud cover forms a top reversal pattern. The first session should be a strong, white real body. The second session’s price opens overthe prior session’s high (or above the prior session’s close). By the end of the second session, it closes near the low of the session and should fall well into theprior session’s white body. Pattern suggests that market has a poor chance of rising immediately

Shooting Star: A single candlestick line during a rally in which there is a small real body (white or black) at the bottom end of the session's range and a verylong upper shadow. The candle line should also have little or no lower shadow. Pattern suggest the trouble for prices overheadlong upper shadow. The candle line should also have little or no lower shadow. Pattern suggest the trouble for prices overhead

Continuation Patterns: Other than widely known Candlestick reversal patterns discussed above, there are numerous patterns mentioned in literature onCandlestick which describe the continuation of existing sentiments i.e. bullish or bearish. We have refrained from mentioning names of these patterns to avoidconfusion. However, the remark Continuation Pattern refers to bullish or bearish candlestick patterns which suggest continuation of existing trend

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Pankaj Pandey Head – Research [email protected]

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