Watchlist for next week

Following are a few stock that I like for the coming week. The important levels are marked on the charts themselves. Click on them for a larger view.

Also, here is my take on the recent move in Gold.

Take care and good luck!

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Gold Weekly Chart Anaylsis

Its been interesting watching the action in gold lately and even more interesting listening to the "experts" and their views on where it is headed. It seems like every time gold makes a big move either up or down, we have people giving either absurd high targets or ridiculous low targets. It helps sometimes to just ignore the noise, step back and have a look at the bigger picture. Taking that literally, below is a weekly chart of gold. It turns out that gold has been stuck in a trading range (~148-174) for the past one and a half years or so.

And here's the weekly chart since 2005. Considering the move that gold has made in the last five years or so, is it really surprising that its been stuck in a trading range for a while now? Seems to be making the logical move, doesn't it? 

Sometimes all one's gotta do is relax, take a deep breath, wait for the weekend, have some bourbon, and before you know it, it all makes sense!

Also, here is a watchlist for next week.
 

Take care and good luck!

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HUDCO Tax Free bonds 2012-13 review

After REC, PFC and IIFCL tax free bonds, its now the turn of HUDCO to come up with similar bonds. Following are the details of this issue. There is no 20 year option this time, unlike the IIFCL bonds.

Face Value: Rs. 1000

Issue Price: Rs. 1000

Nature of Bonds: Secured

Minimum Application: Rs. 5000
Issue Opens on 9th January 2012
Issue Closes on 22nd January 2013

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Duration	10 years	15 years
Frequency of Interest Payment	Annual	Annual
Coupon Rate	7.34%	7.51%
Coupon Rate for Retail Individual Investors (less than 10 lakhs)	7.84%	8.01%

Even NRIs are allowed to apply for these bonds.

These bonds are rated CARE AA+‘ from CARE and ̳IND AA+‘ from IRRPL

 

The income by way of interest on these Bonds is fully exempt from Income Tax as per provisions under section 10 (15) (iv) (h) of IT Act.

These bonds certainly do present a good investing opportunity for those in 20% and 30% tax bracket, as the interest income from these is tax free and definitely a better bet than investing in bank FDs. And with the RBI expected to cut rates in the early half of next year, this might be a good time to lock some money if you are planning to invest in tax free bonds.

Take care and good luck! 

CARE IPO allocation status

The following link will let you know if you have been got any allotment under the CARE IPO.

http://mis.karvycomputershare.com/ipo/

Take care and good luck!

IIFCL Tax Free bonds 2012-13 review

After REC and PFC tax free bonds, its now the turn of India Infrastructure Finance Company Limited to come up with similar bonds. These bonds are very similar to those issued by REC and PFC but very interestingly, unlike REC and PFC, these bonds also have a 20 year option. Following are the details of this issue.

Face Value: Rs. 1000

Issue Price: Rs. 1000

Nature of Bonds: Secured

Minimum Application: Rs. 5000
Issue Opens on 26th December 2012
Issue Closes on 11th January 2013

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Duration	10 years	15 years	20 years
Frequency of Interest Payment	Annual	Annual	Annual
Coupon Rate	7.19%	7.36%	7.40%
Coupon Rate for Retail Individual Investors (less than 10 lakhs)	7.69%	7.86%	7.90%

 

The income by way of interest on these Bonds is fully exempt from Income Tax as per provisions under section 10 (15) (iv) (h) of IT Act.

These bonds certainly do present a good investing opportunity for those in 295 and 30% tax bracket, as the interest income from these is tax free and definitely a better bet than investing in bank FDs.

Take care and good luck! 

Watchlist for next week - Part 2

As promised, here is the second part of the watchlist for next week. Here is the link to Part 1 in case you missed it.

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Take care and good luck!

Watchlist for next week - Part 1

Here are a few stocks I like for next week. I have commented on the charts itself. You may click on the charts for a better view.

I will be back with Part 2 of the watchlist later. You can follow me on twitter for latest blog updates. Also, here is the link for free subscription to the blog.


Take care and good luck!

 

REC Tax Free Bonds (December) 2012-13 Subscription

As of end of the day on Friday, the bonds are subscribed 1.56 times. Do keep in mind the issue size is Rs. 1000 crores but there also exists an option to retain over subscription aggregating up to shelf limit of Rs. 4,500 crores.

The distribution of participation so far has been as follows.

Category	No. of times subscribed
Category 1 Public Financial Institutions	0.12
Category 2 Companies	2.71
Category 3 Resident Indians investing more than 10 lakhs	1.87
Category 4 Resident Indians investing less than 10 lakhs	2.09

There has not been much interest from financial institutions, but as expected there has been good participation from the retail investor as the returns offered are quite attractive for those in the 20% and 30% tax bracket.

Take care and good luck!

Who says Technical Analysis does not work?

Just one chart and I rest my case.....

Take care and good luck!

REC Tax free Bonds 2012

Rural Electrification Corporation Limited Tax Free Bonds 2012

Issue opens on: 3 December 2012

Issue closes on: 10 December 2012

Duration	10 years	15 years
Frequency of Interest Payment	Annual	Annual
Coupon Rate	7.22%	7.38%
Coupon Rate for Retail Individual Investors (less than 10 lakhs)	7.72%	7.88%

Face value: Rs. 1000/-
Issue size: Rs. 4500 crores
Minimum application size: Rs. 5000/-
These bonds will be listed on BSE and NSE.

The income by way of interest on these Bonds is fully exempt from Income Tax as per provisions under section 10 (15) (iv) (h) of IT Act.

These bonds are rated "AAA" by CARE and CRISIL.

Take care and good luck! 

Chart of the Day

Huge run up early in the month and has been consolidating nicely since then. MA(50) has been acting as support and now this support has been reinforced by MA(20).

Here are some more charts that I like for the week ahead.

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Take care and good luck!

Watchlist

I thought I would do a quick review of how the stocks from the watchlist posted over the last weekend are doing. It turns out that some of them have done rather well and more importantly, some are still setting up and are still in play for next week.

CNC - Had a nice week as it was positive all days of the week. 44 should be in sights next week but would like to see a consolidation before it tests that.

OEH - Broke the trendline marked last weekend but the next couple of days are crucial for this one. Volume did start to come in on Friday but not a big fan of the close. Its a news play so gotta be quick if you want to play this one. 

PNR - The big winner from last week's watchlist, up over 6% for the week. Hope some of you played it!!

TASR - Still consolidating, still like it. Watch out for a break of 8.25. MA(20) is the support.

PENN - Well, as written last week, the pullback has happened. Lets see if it bounces from here.

MYGN - Has been on my watchlist for two weeks now and have even played it once. Still like it.

Also, like WNC and MIPS about which I had posted in Friday's Chart of the Day. Will be posting today's Chart of the Day later in the evening. 

That's enough charts for now! You can follow me on twitter for latest blog updates. Also, here is the link for free subscription to the blog.

Take care and good luck!

Chart of the Day

Or rather, Chart(s) of the Day. Both the following stocks made strong moves yesterday on impressive volume, and in doing so crossed important resistance levels. They might consolidate here a bit but both are worth keeping an eye on in the near future.

Take care and good luck!

Indian stock market blog post

Here's a stock that I like here from the Indian stock market. As you can see in the chart below, MCX has been in a continuous uptrend and has gained around 40% in the last three months. And it actually looks good for more. Its been consolidating in the last few days. A few more days like this and it would be all set to tackle the resistance of 1600. I particularly like the bullish volume pattern - high volume on up days and low volume on low days.

Take care and good luck.

Watchlist for next week

Below are few stocks that I will be keeping an eye on next week. I have commented on the charts itself. If you do decide to play any of them, do first read the post on strategy for the week ahead.

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Take care and good luck!

Strategy for the week ahead

1. First things first. The bears are firmly in control. I had written last weekend on how much work the bulls will have to do in order for the charts to start looking in their favor once again. Well, things have just got tougher for them since then. So, all moves next week should be made keeping in mind that the bears are firmly in control at the moment.

2. That being said, the markets are in oversold territory and this coupled with the market action on Friday, the odds favor the bulls in the very short term i.e. the first half of the week. MA(200) will be the first resistance that the bulls will have to face and it would not be surprising to see a run up to that level.

3. If you do want to play this probable bounce, be nimble and dont get too greedy. Be on the lookout for intraday plays. Stop losses must be strictly adhered to as the bears remain in control overall. Averaging down is certainly not an option.

Here is the watchlist for next week.

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Take care and good luck!

Tata Coffee soars over 20%

The stock of Tata Coffee soared over 20% in the Indian markets yesterday on very high volume.

I thought this might be of interest to the American readers. Well, earlier this year, "In a separate sourcing and roasting agreement between Starbucks Coffee Company and Tata Coffee Ltd, the later will roast coffee to supply to Tata Starbucks, and to export to Starbucks Coffee Company for its overseas operations. Tata Global Beverages Ltd and Starbucks Coffee Company have set up a 50:50 joint venture (JV) called Tata Starbucks Ltd to harness the vast potential of the growing hot beverages market in India. The JV company would own and operate Starbucks cafes across India. These cafes will be branded as Starbucks Coffee 'A Tata Alliance'. The first store under this alliance opened in Mumbai in October and has, for obvious reasons, generated a lot of interest.

Yesterday's breakout in Tata Coffee was apparently due to its association with Starbucks and Starbucks acquiring Teavana.

http://www.thehindubusinessline.com/markets/stock-markets/tata-coffee-hits-roof-on-consumption-theme/article4098613.ece?homepage=true&ref=wl_home

Take care and good luck!

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Read more at: http://indiatoday.intoday.in/story/starbucks-finally-arrives-in-india-with-tata-allaince/1/171350.html

Read more at: http://indiatoday.intoday.in/story/starbucks-finally-arrives-in-india-with-tata-allaince/1/171350.html

Chart of the Day update

I had posted about MYGN on Monday. Since then it has moved pretty well in a down market. What is particularly encouraging is the bullish volume pattern that has come out since then. The stock seems to be all set to move to its first target of 30.65 and beyond.

Take care and good luck!

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Are the markets oversold here?

Answer : Very much so. At least according to the McClellan Oscillator. In fact, as shown below, the NYSE McClellan Oscillator is at its most oversold levels since May.

 

This does not mean that the bulls come rushing in now. If anything, the momentum lies clearly with the bears here. As I had noted over the weekend, the charts heavily favor the bears and that has very much been the case so far. What the oversold level does mean is that, if you have been short the markets so far, this might be the time to take some profit off the table and it might not be the best time to start new short positions here. One can expect the bulls to show up here and put up some sort of fight. But do remember, that in the "longer" term, its still advantage bears.

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Take care and good luck!

Stock Guru Scam

An interesting article in The Times of India today on a financial services website Stock Guru which turned out to be a scam and. The cops finally arrested the couple behind the scam after one and a half years of "chasing" them. The accused managed to dupe 2 lakh people of Rs. 1100 crores!! For the American readers of the blog, that's 200000 people and 1 crore is equal to 10 Million!! I know I might not be taking a very popular stance here but I blame these 200000 people more than the couple who carried out the fraud. Why?? The firm promised a 20% return every month!! Read that again. 20% return every month! If you fall for something like that, you deserve to have your money taken away from you. Sadly, there is no dearth of such websites and firms in India right now. Here's the link to the full article if you want to read it.

Stock Guru Scam

Take care and good luck!

Chart of the Day

Today's Chart of the Day is MYGN. The stock moved smartly up last week on high volume. This was followed by three days of consolidation on relatively low volume. Even the performance on these three days was impressive considering (a) the magnitude of the move on the day preceding these three days (b) how the overall market behaved during this time frame.

Anyway, the stock resumed its path upwards again today accompanied by an increase in volume. The next target would be 30.65, the close on the day the journey upwards started. Watch out for this stock in the next few days!

Take care and good luck!

Advantage Bears

The bears have wiped the floor with the bulls in the last three trading sessions with S&P ending the week below its daily MA(200). Let's just step back and take a look at the slightly larger picture.

Since the middle of September, the index has formed a series of lower highs and lower lows (see 1-2-3-4 in the chart above). 1-0 to the Bears. And as already stated above, the index closed below MA(200) for the first time since June last week. 2-0 to the Bears. Of course, the bulls are expected to fight back as they very well should. But straight ahead is the big resistance in the form of 1400-1405 level. 3-0 to the Bears. If the bulls manage to crack that, straight ahead will be the MA(20), which has proved to be a tough nut to crack in the last couple of weeks. 4-0 to the Bears. I am going to stop keeping score now as this is just getting cruel. But it must be mentioned that straight after MA(20) looms the MA(50).

So, the bears look totally in control right now and in the markets, unlike in sports, its not fashionable to root for the underdog. The bulls have a lot of work to do and a lot of resistance to overcome before the index starts looking bullish again.

Take care and good luck!

Negative divergences suggest a cautious approach

It was the bulls all the way the last two trading days of the week and I hope you readers had a nice profit making week. It is helpful to make good on days like Thursday and Friday, so that one can afford to play defense in choppy or sideways markets. With many indices at multi-year highs, the momentum lies strongly with the bulls as we head into next week. Let's have a look at the weekly S&P and NASDAQ charts.

Both the indices show are exhibiting negative divergences, with the new highs on the index not being accompanied by new highs on the MACD indicator. I am not saying one should short here, as momentum does lie clearly with the bulls, but it might not be a bad idea to take some profits from last week off the table and let the rest ride with stops in place. If you have missed the party so far, it wouldn't be a bad idea to wait for a period of consolidation or slight pullback rather than jump in first thing on Monday.

Take care and good luck!

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Watchlist for next week

Following are a few charts that I like for next week. Almost all have been consolidating in the last few days and look ripe for making the next move forward. The important levels are marked on the charts itself.

Take care and good luck!

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