Silver: Chaandi Chaandi Soon Again ?

 Hello Friends, 

Sharing my technical view on Silver (dollar terms). Dollar terms prices have longer history and share high positive correlation with silver prices across the world. 

Historical formations:

From the highs of 1980s till now, price action is clearly forming a massive curve. Interesting observation here is that the first high was recorded during 1980 and almost similar high was recorded during April 2011. Again price is reversing positive and this entire formation is curve family formation (bright possibility of cup & handle formation)

Ichimoku on Monthly chart:

During May 2013, prices fell below the Ichimoku cloud, confirming the bearish trend. Till July 2020, prices remained below the cloud. Massive breakout was seen during July 2020 and since then prices have sustained well above Kumo Cloud, which is confirming the inherent strength. 

Since August 2020 till now, prices are constantly taking decisive support on Kijun Sen, confirming mid-term positive trend. 

Future cloud is also turning strong, which confirms that rally is likely to remain intact. 

Monthly formations (Fibo & price action):

From the lows of 2001 to the highs of 2011, if we plot fibonacci retracement, price just took perfect support at 78.6% zone, consolidated well and bounced from consolidation. Consolidation breakout is also coinciding with 61.8% retracement. 

Small sideways consolidation, after massive consolidation breakout, is forming flag. Retesting of breakout, 61.8% and flag bottom are all coinciding, which is offering strong support to the price. 

Weekly chart for understanding Levels:

On weekly chart, this is highlighted zone to accumulate silver. 

Putting it all together:

Decades of price action and recent few years of price action along with Fibo retracement and ichimoku is suggesting good times ahead for silver. 

Kindly note that view shared is on Monthly chart. Don't consider to be like mid term view. 

Cheers,

Kunal

Follow me on Twitter @RambhiaKunal for regular updates !

Launching youtube channel Named "KunalRambhia". Do subscribe for educational updates !

The new batch of "Technical Analysis Mentorship Program" is coming up in November. Kindly contact on (+91) 7045968847 (KRFA) for inquiry.

 

Statutory Disclosure:

Kindly note that this update is only for educational purpose. It is safe to assume that my personal position, my fund's position, and my client's, as well as relative's position, may be open in the counter. Prefer to take the advice of your financial advisor before initiating any position. 

ITC: Can Elephant Dance?

 Hello friends, 

Sharing my technical view on a counter that has been an underperformer on price action for quite a long time. 

Monthly Timeframe with Fibo:

If the entire journey is considered on the price action, the stock tested 61.8% zone during 2020 fall and now making higher tops and higher bottoms, confirming the mid-term positive trend. 

Weekly timeframe with zone:

Since 2013, there were multiple rallies, both, positive as well as negative. But 200 zone is been an important zone for the stock. Considering 200 to be a mean reversion zone, it's presently just onto the same zone, offering a favorable risk-reward ratio for the position.

Weekly timeframe with Average & RSI:

Price entered higher top higher bottom and RSI also continued its northward journey, confirming the trend strength. The counter is recently facing a resistance of 120 period's EMA. Strength is decently built up on the counter and so it's likely to break out. 220 zone to watch out for "Trend confirmation" as well as for "momentum trade". 

Weekly timeframe Ichimoku:

First time since 2018, the counter has crossed and sustained above the Kumo cloud on the weekly timeframe. Price is simply taking the support of the same cloud and the future cloud is turning bullish too. There is a bright possibility of the continuation of a new trend. 

Daily timeframe Trendline:

The simple trendline on the daily chart shows the change in polarity in action and the stock decently respecting the same since a year. 

Ratio chart of ITC & Nifty:

The ratio chart of ITC and Nifty is plotted since 1995. The yellow trendline is acting very strong for the Ratio since then. Also, the recent decline in the ratio is now showing positive divergence on the RSI front, onto the support trendline, which is making ITC worth seeing at present levels. 

Putting it all together:

The Ratio chart with positional view, Monthly retracement at the golden ratio, weekly 120 Period moving average along with RSI, ichimoku Kumo cloud support, all are supporting it to worth taking a positional view on the counter with the favorable risk-reward ratio. 

Cheers, 

Kunal 

Follow me on Twitter @RambhiaKunal for regular updates !

Launching youtube channel Named "KunalRambhia". Do subscribe for educational updates !

The new batch of "Technical Analysis Mentorship Program" is coming up in August. Kindly contact on (+91) 7045968847 (KRFA) for inquiry.

 

Statutory Disclosure:

Kindly note that this update is only for educational purpose. It is safe to assume that my personal position, my fund's position, and my client's, as well as relative's position, may be open in the counter. Prefer to take the advice of your financial advisor before initiating any position. 

BHEL: Will this "tasty food of the Street" get "Chef touch" to make it more delicious ?

 Hello all, 

Before we move onto all observations of BHEL, herein I share something which I enjoy doing along with my fund management activity. 

I conduct online sessions to teach Technical Analysis. The online journey started a year back and we, at KRFA, have conducted 4 online sessions by now (and many offline sessions in the last 3 years), adding more than 65 participants to our growing KRFA family. The new batch for the session is upcoming next week. Details are shared here. I would feel fortunate to serve you all; if anyone of you wishes to learn Technical Analysis. Feel free to contact KRFA at 7045968847.

Let's begin with observations of BHEL. First, we look at the monthly chart to understand broader 

formation. 

Monthly Price Action: 

Price is in decline mode for a decade. But it was contracting in nature, creating falling wedge formation, which is bullish in nature. 

Breakout of the falling wedge was seen during Feb 2021. Follow-through price action is seen in the present month. The price made bottom during April 2020 and since then volume is supporting the uptick. Volumes recorded are the highest ever recorded since the listing. Similar volumes were seen during 2000, confirming accumulation volume. 

Weekly price action: 

Price is showing a decisive curve formation on the chart. The declining trendline breakout confirms the emergence of a new trend.

The higher top higher bottom is confirmed based on the breakout of a black dotted line. The recent uptick is showing a perfect trend after retesting the breakout level. 

The blue line (previous high) breakout will confirm a curve formation breakout. 

Every uptick is confirmed with positive Volume activity (highlighted with trendline on volume). This confirms the likely emergence of a new trend. 

MACD on the weekly chart: 

MACD has crossed 'zero' line and has traded decisively above that, confirming the emergence of a bullish trend. 

Moving Average on the weekly chart:

160 period's EMA on the weekly chart is decisively offering resistance since 2015. The specific observation is that it's the first time that price is attempting to trigger a breakout immediately after the first attempt. On the breakout of the EMA, the uptrend will get moving average confirmation. 

Ichimoku on the weekly chart:

This indicator confirms the trend of the price. June 2015 was a failed attempt to cross the Kumo cloud. May - June of 2017 was again a failed attempt. Presently, the cloud is turned comparatively thin and the price has decisively remained about the same and also made higher top higher bottom too. Future cloud is also showing bullishness and price is trending well above Tenkan & Kijun along with Chikou in free air above the price. All confirm the beginning of a new trend. 

ADX DMI on the weekly chart: 

This indicator confirms the strength of the trend. Since bottom formation in April 2020, clear HTHB is seen on the price action. +DMI is turned dominating, crossed 25 levels, and "cross & hold" is in action. Eventually, ADX has surpassed 25 levels, confirming the strength of the move. 

Fibonacci Extension on the weekly chart:

Fibonacci is used as the price is forming a series of HTHB. This tool helps to define the approximate target on the price action. Using the first swing, the approximate target comes to 68 (161.8% extension) and 93 (261.8% extension). 

Putting it all together:

Monthly as well as the weekly timeframe is confirming a firm price action underway for the counter. Looking at various indicators and price action, it seems safe to accumulate the counter on every level. Unless a massive downside emerges on the counter, its uptrend will remain intact. 

Cheers, 

Kunal 

Follow me on Twitter @RambhiaKunal for regular updates !

Launching youtube channel Named "KunalRambhia". Do subscribe for educational updates !

Statutory Disclosure:

Kindly note that this update is only for educational purpose. It is safe to assume that my personal position, my fund's position, and my client's, as well as relative's position, may be open in the counter. Prefer to take the advice of your financial advisor before initiating any position. 

IOB: Can This Deliver Surprise Returns ?

 Hello all, 

Herein I share my observation on IOB. Many of the market participants may not be willing to read this further on the name of the counter itself :) But I give importance to price performance & found this worth spending time on analysis, keeping risk-reward in mind.

Monthly Ichimoku:

Price broke below Kumo cloud during 2011 and remained below the same since then. It's the first time in the decade, the price is entering Kumo Cloud, challenging downtrend, along with Tenkan crossing Kijun upside. This has generated the first ray of hope in the darkness. 

Weekly 200 EMA:

200 week's exponential moving average is served as a decent resistance during the entire decade. The price crossed above moving average once during mid of 2014, but failed to sustain above the same. It's one more attempt after 7 years again. Well, whether it will sustain or not is anyone's guess, though worth keeping in mind. 

Weekly Ichimoku:

After 2 unsuccessful attempts since mid of 2017, it's the First time that prices have sustained above the cloud and have decently consolidated. Future cloud is turned bullish along with Tenkan - Kijun crossover and Chikou Span in open space. All screaming trend reversal from bearish to bullish. 

Weekly RSI:

RSI entered overbought zone first time in 2002 and stock ended up delivering 600% returns. Similarly, 3 times RSI entered overbought zone and counter delivered 100% returns. Well, counter has doubled from the low by now, BUT the RSI has not given up like the recent 3 events which are highlighted. So can this time it can deliver more? Well, it's worth remembering point. 

Weekly ADX:

Trending ADX shows the emerging trend. Not speaking much on DMI behavior. Strength picked up during 2007 - 2011 and stock delivered more than 400%. Similar strength is picking up and still not giving up. Again, a point worth noting ...

Daily Chart Price Action:

Massive curve formation since 2018 is coming to an end with a small curve within the bigger one. The end of the curve is been supported with the highest ever recorded volumes. On curve (so-called cup and handle) breakout, the price can confirm the end of consolidation and beginning of an uptrend. 

Fibonacci Extension:

Fibonacci numbers have great importance even in Elliott waves to gauge the extent of correction and potential targets. 3 levels are given importance, 161.8%, 261.8% and 423.6%. These extensions are applied on higher top higher bottom confirmation. Looking at recent price action, it makes sense to apply the extension tool and stay optimistic. 

Putting it all together:

After studying the monthly and the weekly Ichimoku set up, RSI, ADX, 200 Week's Exponential Moving Average & price action on the weekly and the daily chart, I feel IOB is offering the best risk-reward setup with all favorable price actions. 

Cheers,

Kunal

Follow me on Twitter @RambhiaKunal for regular updates

Statutory Disclosure:

Kindly note that this update is only for educational purpose. It is safe to assume that my personal position, my fund's position, and my client's, as well as relative's position, maybe open in the counter. Prefer to take the advice of your financial advisor before initiating any position. Prefer to keep the risk-reward ratio in mind, give importance to personal temperament, risk appetite, and financial background.

USDINR: "Pawry" May Come to an End !

 Hello all!

I got many messages asking why I stopped updating views on the blog. I truly appreciate everyone's trust in my knowledge and their eagerness to learn. I was stuck in too much work and so I took a break from writing updates. But will start updating regularly again. 

Herein I share my observation on USDINR. 

Price Action:

An up trendline is made on the chart from the bottom of 2011 till now. Multiple times price has taken support on the same line in the past. Recent lows also took support on the same trendline, showing that the trend is still positive. 

A trendline made from the peak levels of 2018 shows good support at the same zone where the bottom was formed. The formation looks like a Falling wedge. 

A trendline connecting multiple highs of 2018-2020 also created a change in polarity, offering support to the price near lows. That inflection point was highlighted in my previous updates. 

The size of bullish candles near the support zone is very large, highlighting decisiveness in the action.  

100 EMA:

100 week's exponential moving average has offered support/resistance multiple times in the past and the recent bottom was also on the same zone, confirming the accuracy of average on USDINR and also confirming the positive trend on the price. 

ADX - DMI:

In the recent falling wedge formation, it is very clearly seen that price was making lower lows and negative DMI has formed lower lows too. This is considered as "Bullish divergence" and prices have shown a decisive bounce from the lows, confirming the observation. 

Ichimoku:

Price is taking resistance at the cloud. Future cloud is also bearish, suggesting that the trend is still negative and likely to remain negative in the near future (till it crosses the cloud). 

Putting it all together:

100 EMA and ADX-DMI indicators along with the longest trendline are suggesting that the uptrend on the price front is intact. Rs. 72 is certainly the Strong support zone. Falling wedge is a bullish formation but the breakout is certainly pending. The breakout zone is coinciding with the Ichimoku cloud resistance, suggesting that the uptrend may emerge on the breakout of the falling wedge. The zone to watch out for breakout is Rs. 73.75. Ine can expect a Bullish rally if prices break out of the formation. (kindly note that all the charts shared here are weekly charts and so one needs to wait for closing basis confirmation). 

Levels to watch out:

Support zone: 72

Resistance (breakout zone): 73.75

Cheers, 

Kunal 

Statutory Disclosure:

Kindly note that this update is only for educational purpose. It is safe to assume that my personal position, my fund's position, and my client's, as well as relative's position, maybe open in the counter. Kindly prefer to take the advice of your financial advisor before initiating any position. Prefer to keep the risk-reward ratio in mind based on personal temperament, risk appetite, and financial background.

Tata Motors: Will Zero Debt Target Fuel The Rally Further ?

 Hello All,

Herein I share my views on the daily chart and weekly chart of Tata Motors using different tools and indicators. 

Price Action:

Just by focusing on the last up move in the line chart, resistance and support lines are made, which are highlighting a possible rising wedge. The recent uptick was faster and price action was steeper. The blue support line was well respected, but in the last 2 days, the support line was broken. Price may come to test the red support line. 

Also double top formation seems likely, as price rise halted in the same vicinity of the previous top. It's on a very early stage to call this double top, but looking at RSI formation (which is explained in later part), this formation has higher possibility of happening. 

Price Action: 

Looking at the broader formation, one can see that the trend is clearly negative. Prices have reached 2 years old resistance trendline zone. Pause in the ongoing upmove is likely. 

Fibonacci Retracement:

After declining from the zone of 200, the stock made low near 60s. The reverse retracement of this entire fall is checked. The golden ratio 61.8% is highlighting resistance zone of 148. The stock has taken pause in the same zone, which reaffirms the belief of likely pause. 

RSI:

The stock price inclined and made higher highs but the momentum indicator started fading away near overbought zone, made lower tops and confirmed bearish divergence, which is suggesting caution in the ongoing rally. 

MACD:

A lagging indicator MACD is also confirming a crossover signal, which again confirms the likely pause. 

Weekly chart of Tata motors:

Ichimoku:

Multiple interpretations are available on ichimoku indicator, when placed on weekly timeframe. It is clearly seen that the stock has multiple times faced resistance of cloud since 2017. Presently, the stock has halted in the same zone and created shooting star on weekly chart after a bearish candle. 

Tenkan Sen and Kijun Sen crossover is seen but the slope of them is flat, which confirms no major trend change in the recent past. 

Future Kumo cloud remains bearish and Span B is flat. 

Present kumo cloud is also bearish and there is no sign of kumo twist. 

Chikou span is just reached kumo zone, where it has faced resistance multiple times in the past. 

All signs indicate NO trend reversal from bearish to bullish. 

Exponential Moving Average:

As I have shared multiple times in the previous posts also, the best moving average is the one which had offered the best support resistance zones to the prices, here I came across the moving average which suits the best on the counter. i.e. 85 periods' EMA. The price has taken multiple supports and resistance in the last 4 years. The counter made bearish candle formation in the same vicinity of the moving average, which reaffirms likely pause in the ongoing rally. 

Putting it all together:

Rising wedge and possible double top on the daily chart near 61.8% retracement zone, along with RSI divergence and MACD Crossover and most of the parameters of Ichimoku on weekly charts along with 85 period EMA confirms likely pause in the ongoing rally. 

Remember, I am using the term "Likely pause" as intermediate trend reversal confirmation remains pending and I can't deny the continuation of rally. But looking at the discussed parameters, the risk-reward seems THE BEST to initiate bearish trade. 

Cheers,

Kunal

Statutory Disclosure:

Kindly note that this update is only for educational purpose. It is safe to assume that my personal position, my fund's position, and my client's, as well as relative's position, maybe open in the counter. Kindly prefer to take the advice of your financial advisor before initiating any position. Prefer to keep the risk-reward ratio in mind based on personal temperament, risk appetite, and financial background.

USDINR: Will it stop sliding further ?

Hello all, 

herein I share my positional technical observation on the weekly chart of USDINR. 

Price Action:

After the massive decline in prices from the peak of 77 zones, the price has taken the support of the 2 years old long term trendline last week. Doji is seen right onto the trendline, highlighting a likely pause in the downtrend. The rising wedge pattern seems to be unfolding, where the last leg of uptick remains pending. 

Moving Average:

On the weekly chart of USDINR, using the trial and error method, it is seen that 75 period's EMA offers the best support and resistance. Being an average, certainly few whipsaws are seen. But this seems to be the best moving average as per the past price behavior with respect to the support and resistance. Presently, the price took support on the same moving average, which is coinciding with the trendline support. 

RSI:

There are 2 main observations on the RSI front. 

The overbought and the oversold zone is rearranged as per the past behavior. It is seen that recent prices pushed the RSI near that support (oversold zone) of 35 levels. In the past, prices showed decent reversal after RSI reaching this zone. 

The second thing to notice here is that the prices are making higher lows and RSI is making lower lows, taking good support of the downward sloping trendline. This seems to be forming a hidden bullish divergence. Though a divergence doesn't offer any trade as such, but it certainly serves the purpose of being cautious about the ongoing (down) trend. 

Ichimoku:

Here are again multiple points to notice. 

Tenkan sen has crossed Kijun sen on the lower side, but Kijun sen is still flat. So this can be a minor correction of the ongoing major rally and there seems a bright possibility of the main trend continuation. 

The present Kumo cloud seems to have offered the best support to the declining price. 

The future Kumo cloud is still bullish with upward-sloping Span A and slat Span B. This offers the ray of hope for the trend continuation. 

Chikou span is within the price action, confirming likely consolidation of price action before new / continuation of the rally. 

To sum up the whole indicator outcome, there is a bright possibility of a sideways move, followed by the potential trend reversal (from the recent downside to the upside). 

Putting it all together:

Doji candle followed by the bullish candle (ongoing weekly candle), right onto the two years trendline support and 75 periods' EMA, strong RSI (based on oversold region), and hidden bullish divergence along with all bullish signs from Ichimoku is creating a reliable bullish environment for the price action from hereon. One needs to remember that observation is on the weekly chart and so view remains positional. 

Cheers, 

Kunal 

Statutory Disclosure:

Kindly note that this update is only for educational purposes. It is safe to assume that my personal position, my fund's position, and my client's, as well as relative's position, maybe open in the counter. Kindly prefer to take the advice of your financial advisor before initiating any position. Prefer to keep the risk-reward ratio in mind based on personal temperament, risk appetite, and financial background.