Indextowatchnextweek — Trading Ideas on TradingView

BSE Capital Goods Index: A potential Candidate for a Breakout. BSE Capital Goods index this week has taken support near the Mother line on weekly chart. Currently the weekly close at 67151. Mother line support is at 66005. If the Index can manage to close above 67893 or 68227 there is a strong chance of revival which can take the index towards 70727, 71K or even 72K+ levels as indicated in the chart. For this to happen the index needs to hold current level not close below 66K levels (Mother line) and move Northwards. In case 66K is broken the index can fall towards 65 or 64K levels. Right now the support is taken so the index looks strong. The pattern that we are seeing on charts is similar to cup and handle formation in progress. The formation has not succeeded so far but if this formation comes in full effect, the index will become very strong. When the index is strong and gives a breakout it means that the undercurrent in majority of the companies which constitute the index is strong. There will be some companies which will obviously drag the index down as there cannot be one-way traffic. To know amongst these which companies to invest in an investor should look at fundamentals of the company, recent and past results, cash flows, Sales and order books, EPS and many other factors. While a Technical investor should look at charts of the companies before investing. The BSE Capital Goods index consists of 36 companies. The companies that constitute this index are HAL, Suzlon, Titagharh, BEL, Cochin Shipyard, Zentech, Mazdock, Fincables, BDL, Inox wind, CG Power, Kaynes, PTCIL, Polycab, Cummins, Power India, Apar, BHEL, ABB, Astral, Siemens, Kirloskar Engine, Triveni Turbine, KEI, Carborandum, Supreme Industries, Grindwell, Thermax, Praj, Elgi Equipments, Honeywell, Jyoti CNC, Timken, SKF India, AIA Engineering and LMW. The focus should be on companies which have major market which caters to local consumption or exports order to the US. Look for strong performers within this index who have given a good result this quarter and have strong EPS growth and good order books as well as trailing PE ratio less than 10 years Average PE ratio. This would result in you finding out the companies which are undervalued and have good growth potential. Capital Goods are essential for a country to grow. A strong GDP will mostly mean strong performance by some these companies. A smart investor would be a person who looks at both fundamentals and technicals of the company and invests in a fundamentally strong company which is giving a technical breakout. For this one has to learn Techno-Funda analysis. I have written a book on the subject called The Happy Candles Way To Wealth Creation. In this book you will learn the basics of Techno-Funda investing. The book is available on Amazon and is one of the highest rated books in its category. With an approval rating of 4.8/5 as on date. Lot of investors call it as a Hand book for Techno Funda investing. Most of the chapters are standalone and can be read at your own accord. It will be really helpful to you. To know more about Mother line, Father line and my Mother, Father and Small child theory, Parallel Channel you should once again I recommend, read my book the Happy Candles Way to Wealth Creation. Disclaimer: The above information is provided for educational purpose, analysis and paper trading only. Please don't treat this as a buy or sell recommendation for the stock or index. The Techno-Funda analysis is based on data that is more than 3 months old. Supports and Resistances are determined by historic past peaks and Valley in the chart. Many other indicators and patterns like EMA, RSI, MACD, Volumes, Fibonacci, parallel channel etc. use historic data which is 3 months or older cyclical points. There is no guarantee they will work in future as markets are highly volatile and swings in prices are also due to macro and micro factors based on actions taken by the company as well as region and global events. Equity investment is subject to risks. I or my clients or family members might have positions in the stocks that we mention in our educational posts. We will not be responsible for any Profit or loss that may occur due to any financial decision taken based on any data provided in this message. Do consult your investment advisor before taking any financial decisions. Stop losses should be an important part of any investment in equity.

The Index to watch next week: FMCG Index The index that is trying to break out and one needs to watch the next week seems to be the FMCG Index. The FMCG index is currently facing the Mother line resistance. If the index can overcome the Mother line resistance which is at 53619 there is a chance that this index in the near future can go on to its net resistance levels which are at 54203, 55259 or even 56230. A closing above 56230 or the Father line and the trend line near by in a few weeks or the next quarter can lead the index to gain some previous levels like 57K, 58K or even 59K. The support for FMCG index is currently at 52656, 51508 and 50176. To know more about supports, Resistances, investing in stocks based on sector index, Trend lines Parallel Channels, Mother, Father and small Child Theory, Behavioural finance, Fundamental analysis, Technical analysis, Profit booking etc. Read my book The Happy Candles Way to Wealth creation. It is as on date one of the highest rated books on Amazon. The paperback version and Kindle can be bought through Amazon. You can also contact me to buy the same. Now if this breakout actually happens in the Nifty FMCG index the some of the stocks that composites the FMCG index will be the beneficiaries. Some might benefit more some might benefit less and some might not benefit but for index to move upward the stocks composing it have to perform well. To know which stocks will do better than others we will have to look at their individual charts. The stocks which make the Nifty FMCG index are Tata Consumer, Britannia, Radico Khaitan, Godrej Consumer Products, UBL, Dabur, United Spirits, Nestle, Colgate, Marico, PGHH, Dabur, Balrampur Chini, Hindustan Unilever, Varun Bevreges and ITC. The Index Can Perform if the majority constituents or the stocks with heavy weightage perform. Some of these stocks can perform others might not. Choose wisely after consulting your investment advisor, studying fundamentals and Technicals of each company. Disclaimer: The above information is provided for educational purpose, analysis and paper trading only. Please don't treat this as a buy or sell recommendation for the stock. No one can guarantee any success in highly volatile market or otherwise. There is also chance of bias in our opinion. The supports and resistances indicated are based on data which has a cycle time of being 3 months or older so it is not necessary that it will work. The author or Smart Investment will not be responsible for any Profit or loss that may occur due to any financial decision taken based on any data provided in this message.

Index To Watch Next Week: CNX Pharma Index. The index that did very well this week and which has potential to carry forward the momentum into the next week seems to be the CNX Pharma Index. The pharma index looks strongly placed above Mother Line of 50 Weeks EMA line. The resistances it faces or can face if it moves upwards can be near 21667. If this trend line resistance is crossed, there is a possibility of Pharma index reaching 22117 or 22428 . 22428 will be a little tough to cross as it is the mid resistance of the parallel channel in which CNX Pharma index is travelling. If we get a closing above it, there is a real possibility for the index to reach 22715 or even 23K+ levels. The support for CNX Finance is the Mother and Father lines which are merged near 21144 and 21176 zone. If this major support zone is broken the index may fall to 20637 or 19628 levels. To know more about Parallel Channels, Mother, Father and small Child Theory, Behavioural finance, Fundamental analysis, Technical analysis, Profit booking etc. Read my book The Happy Candles Way to Wealth creation. It is as on date one of the highest rated books on Amazon. The paperback version and Kindle can be bought through Amazon. You can also contact me to buy the same. Now if this breakout actually happens in the Nifty Pharma index the some of the stocks that composites the Pharma Finance will be the beneficiaries. Some might benefit more some might benefit less and some might not benefit but for index to move upward the stocks composing it have to perform well. To know which stocks will do better than others we will have to look at their individual charts. The stocks which make the Nifty Pharma index are Sun Pharma, Mankind Pharma, Dr Reddy’s Lab, Auro Pharma, Lupin, Cipla, Glenmark, Ajanta Pharma, Biocon, Alkem, Laurus Labs, JB Chem Pharma, Granules, IPCA Labs, Abbott, Zydus Life, Natco Pharma, Gland Pharma, Torrent Pharma, Divi’s Lab. The Index Can Perform if the majority constituents or the stocks with heavy weightage perform. Some of these stocks can perform others might not. Choose wisely after consulting your investment advisor, studying fundamentals and Technicals of each company. Disclaimer: The above information is provided for educational purpose, analysis and paper trading only. Please don't treat this as a buy or sell recommendation for the stock. No one can guarantee any success in highly volatile market or otherwise. There is also chance of bias in our opinion. The supports and resistances indicated are based on data which has a cycle time of being 3 months or older so it is not necessary that it will work. The author or Smart Investment will not be responsible for any Profit or loss that may occur due to any financial decision taken based on any data provided in this message.