Short squeeze candidates

All the following stocks have two things in common: (a) over 20% of their floats short (b) setups that can run from here. But do remember, as with all heavily shorted stocks, they can be highly volatile.

Take care and good luck!

Relief rally or something more meaningful?

The markets did finally bounce today, from the highly oversold conditions. The bounce indeed was very impressive but the question is whether this is just a relief rally, where we continue going down after a brief respite or something more meaningful that. Here are the levels I will be looking at to get the answer to this questions.

 

The very obvious level to watch out for is MA(50), which the market might tackle as soon as tomorrow. But the line in the sand, at least for me, would be the 1220-1225 zone. Of course, higher highs would be great but a move above the 1220-1225 zone is needed to show that this move actually has some legs.

Take care and good luck!

Is it the righ time to start buying Indian stocks?

Enjoying the luxury of some rare free time this Sunday, I decided to work on a historic P/E ratio chart of the Indian stock market. For those of you who do not track the Indian sensex, it has been one of the worst performing indices in the world this year, being down over 20% YTD. It has lost over 11% this current month. So, the idea was to see where the indices stand in the historical context after this huge drop. Well, see for yourself......(Right click on the image and select "view image" for high resolution image)

Median P/E - 18.09
Average P/E - 18.05
Present P/E - 17.05

I would love to see it fall to a P/E ratio of 15 but that's me just being too greedy! Timing the markets exactly on the basis of charts like above is impossible but they do give you a very good idea of oversold and overbought levels. Inspite of the huge decline, the markets don't look as cheap as one would expect as they were overbought last year. I will try to do a similar chart on P/B ratio before the end of the day.

Take care and good luck!