Some Good Steals...

rahulg77 · May 8, 2006

Hi Amit,

Your view on Fedder Llyod pls. 500139. I had invested in it at 167 levels. It is on circuit since then. but the circuit is like a dragon fly. Which according to candle stick is also a reversal signal if there is a confirmation next day. But the shadow of the dragon fly is becoming slow day by day. which would means the sellers are loosing. But the volume is also decreasing. What would this mean. Pls explain.

Also IPCL. please if you could explain this also considering RSI. I was seeing RSI. On 24/04/06 the closing price was same as the closing price of 08/05/06. but RSI is lower on 08/05/06. Would this mean a divergence. I am not able to analyse this. please help.

Regards

Rahul

AMITBE · May 9, 2006

chachi said:

Hi Chachi...good spotting again, not so much for the breakout but for the pattern. It's a relatively less known and spotted pattern.

A Falling Wedge in a down trend indicates a bullish reversal. It's also the part of the triangle family.

The falling wedge forms when the rate of decline of the highs is greater than the rate of decline for the lows.
So we have a sharply dipping upper line and a flattening lower line.
Despite the pressure from the upper line, the lower line shows much strength in not dipping out of shape.
The wide gap on the left side between the two lines narrows into a cone and then the breakout.

Rising or falling wedge were recently discussed here:
Have a look there and the charts and see what has been happening since that post.

Further on to Mercator, now zoom out a bit to get a longer term view.
Is there something that resembles a Head and Shoulder?
Have a close look and make comments?
What are the critical levels that would get into play if this pans out as a H&S.
How would it be negated?
This is not to say it'll happen, but this can be an exercise to go looking at different patterns.

Good going Chachi...great to see the progress.
Cheers.

mahmeds2000 · May 9, 2006

rahulg77 said:

Hi Ahmed,

Amit sorry for replying to a query asked to you. Ahmed I am also quite new to the market but what I have learnt in this forum is never predict the market. The price and the market tells you everything. Ofcourse you have targets but then the price is the ultimate decider. So go follow the trend and the indicators. If they tell you to get out you get out or just ride the wave and enjoy.

Hope it helps you. Pls Amit your views to.

Rgds

Rahul

hI RAHUL,
Thanks for the reply at least u have given the reply. I got a little.
Thanks
wrgrds
Ahmed

chachi · May 9, 2006

AMITBE said:

Yes...Yes....Yes...Amit

I am too exited....
I could see the H&S pattern in the making....
The second shoulder is in the making probably....

critical resistance levels should be 58, 62.
support are at 43, 41. Further downside at 34.

How would it be negated?... I dont know.

(I am sorry if I am not meeting your expectation here)

Please continue to teach me on this..

Regards
chachi

AMITBE · May 9, 2006

chachi said:

Hi Chachi...this is only for going over certain patterns and observing what goes on. This practice willl make the 'eye' sharper.
So here we are talking of probabilities to understand patterns, but Mercator can go anywhere.

Should a right shoulder formation be under progress, it cannot go well above the left shoulder, or for that matter stay well below it.
The left shoulder level is around 56-57.
You've written 62 above, which is the top of the 'head'.
A move to this level would render Mercator quite bullish, where a H&S is a bearish pattern. So a move there will certainly negate a H&S.

So a critical level to watch is 55-57, the left shoulder.
The other critical level is the 'neckline' area. The levels here are 40-42.
It's only at a break below this area that H&S would be confirmed.

To put it together, going ahead now, price would meet resistance at 55-57 area on diminished volume and falls back on increasing volume, where the volume would remain high breaking below the neckline at 40-42.

To recap today's action on Mercator after yesterday close at 54.55, it has tested high at 57 after a gap up opening at 56.
It traded on small volume till 51-52 held, then the volume spurted (arrows) as price tested 43.65 on the 3 minute chart. Price is back at 51 levels now.

Keep a track and all the best.

chachi · May 9, 2006

Hi Amit,

It has been a nice lesson so far. Thanks a lot.

Would like to have your views on FIRSTLEASING. For me this also appears to form a H&S, although with a long narrow neck. Right shoulder formation should be at around 60. and Neckline is .... here I am bit confused as the neckline at right and left shoulder differs.

Regards
chachi

AMITBE · May 9, 2006

chachi said:

Later Chachi...there are several queries on technical issues waiting that I should attend to.
Will come back to First Leasing in a day or two.

chachi · May 9, 2006

Amit, sorry I hooked for a long time. I will wait.

Regards
Chachi

AMITBE · May 9, 2006

rahulg77 said:

Hi Rahul...I'd like you to go back to the charts of Fedders and observe the following:
Yes, but let the Dragonflies fly as they're just a kind of bar that tell us nothing here.
But notice the gap-ups. The price is closing at day's high all these days.
If you calculated the difference between one day's close and the next day's, the difference is 5%. Meaning this counter has been hitting the upper circuit all these days. Quite easy isn't it.
That's just the way upper circuits look on candlesticks. Enjoy the ride.

As to the RSI issue on IPCL, do go back and check on what it is that RSI is built upon and what it tells us.
Do this as an exercise and the answer should come as easy as the Dragonflies.

Will certainly give feedback.

nkpanjiyar · May 9, 2006

AMITBE said:

Super Spinning (SUPERSPIN) is a Coimbatore based company belonging to the extended family of Lakshmi Machine Works which commands the price of over 20000 per share.
Like Lakshmi Machine, Super Spinning is a strong growth stock with excellent fundamentals. It's also a defensive, low volatility and low liquidity counter.
I've seen low liquidity usually means the promotors hold the bulk of the stock for obvious reasons...Madras Cement, Indogulf Corp, Gujarat Flourochem are examples.
At 399 Super Spinning has been consolidating/accumulating well. It can be accumulated with stop at 390. A slip below 390, though the chances are slim, would give an even better entry at 378-383. This is a mid to long term idea. A couple of quarters would see a strong capital growth.

Amit bhai, just to acknowledge: it was great call on Super Spinning. It was up 14.54% today. Great going and I am in too.

cheers,
nkpanjiyar

Some Good Steals...

rahulg77

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mahmeds2000

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chachi

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chachi

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nkpanjiyar

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