Individual decisions will always supercede to those of masses.

One of the theories which justifies why ITC struggles to have a big rally as other stocks have.

FMCG stocks' analysis from a different
view

Thread:

A THREAD ON SL, TSL AND RE-ENTRIES-

WHERE TO PUT THE SL-

1. NEAREST PIVOT/SWING POINTS-

Normally I use this method for placing sl, In this method we use swing point for placing the SL.

As normally the stock would not try to go below previous swing point if it is to go in our direction.

2. ATR method-

Sometimes the Stock do not have any nearest pivot at time of buy, So we use this method as it gives us a level on basis of current volatility of the stock.

I use 1.5 ATR away sl , say the ATR at point of entry is 30, so I place sl
1.5 X, or 45 rs away from entry

In below example the entry is 120, ATR=5, SL= 1.5X ATR= 7.5 OR 113.

Nearest pivot was too far away, that’s why this method is used in these cases.

4. Anchor candles-

Anchor bars are those which have extreme Volume, gaps or wide Ranges.

Here, we place our sl below those candles which has the above characteristics.

"A trend once established, is more likely to continue than it is to reverse"

A thread on Trend (Market structure)-

A trend is a path of least resistance, basically the side where the smart money is betting upon.

And our work is to be on their side, to make some money.

Why do we use trend?

In an uptrend, the sum of the rallies will always be greater than the sum of the declines.

In a downtrend, the sum of the declines will always be greater than the sum of the rallies.

How to Find the trend?

There are 3 methods which one can use-

1. Swing points method.
2. Moving averages.
3. Trend lines, channels.

1. Trend identification by using swing points-

• UPTREND in simple words - Higher highs, higher lows

• DOWNTREND in simple words - lower lows, lower highs.

• Flat trend - The price stays in a range

A small thread on momentum investing and how I practice it.

I use the Nifty 500 universe for selecting my momentum stocks. Nifty 500, as the name suggests, has 500 companies in it. WRONG !!!! It actually has 501 companies. Yes, I double-checked 🙂 So, these 501 companies is

my talent pool (if you will) from which I select the 50 best candidates that I want to bet my money on.

Ok. So, exactly, did I go about doing that.

Step 1: Start with Nifty 500 universe (501 companies)

Step 2: Eliminate all those companies which have a listing history of

less than 1 year. This eliminated 25 companies (see table).

Step 3: For the remaining 476 companies, I computed their last 12-month rolling price returns (meaning, comparison of their price as on March 31, 2022 as compared to that as on March 31, 2021, and then computing the %

gain that each of those stocks have earned. I found out the following:

a) Average return of all the 476 companies was 43.27% (meaning if their average price as on March 31, 2021 was 100, then their average price as on March 31, 2022 was 143.27)

b) Out of these 476 companies

140 companies, gave a negative return.

c) Out of the balance 336 companies, 46 companies gave single-digit returns

d) Out of the balance 290 companies, 101 companies gave a return between 10-30%

e) Out of the balance 189 companies, 55 gave returns between 30-50%

CHEAT-SHEET

Multiple Confirmation short.

A Short Entry that we shared in 2020.

Study it point wise.

1. Bearish Candle type and lowering of volume on Price rise.

2. OBV divergence.

3. Accumulation with Bearish candles and Volume increase on Price decrease.

STUDY IT!

Explanation

1. When price increases with a decreasing volume, it's bearish.

2. OBV, On Balance Volume should be correlated with price.
If price increases without similar increase in OBV, it's bearish.

3. During consolidation, if the volume increases during dumps, it's bearish