Charts

As promised I had started preparing for trading post but could not find a clear cut trade for the week. There were too many uncertainties and assumptions which were greatly diminishing the risk to reward ratio. I though after so many days if I am doing any trading post, I should be slightly more convincing. Another factor is this being expiry week, volatility may be little high for our comfort. So I decided against writing the trading post.

However, I did not want to go back to continuing MA post and was in mood to post some charts anyway. So I decided to improvise the trading post a little. Here I am posting charts of some very popular NIFTY components. Again the commentary is minimum.

Reliance:

You simply cannot skip RIL when talking about NIFTY. This stock used to be the single biggest factor in deciding NIFTY direction not long ago. However presently there is not much to say here. As you can see the stock is in clear downtrend in the channel. The channel has just intensified and this in spite the fact that there is an active buy back is in the progress. It was never my favorite and certainly isn't one right now.

State Bank of India:

This is the Indian bellwether of probably the most important sector in the World right now... Banking. This stock is a direct barometer of health of Indian Banking system though sometimes it has to bear the brunt of being a Public Sector Bank. As you can see, recently as a very short term level it has started creating higher highs and higher lows (This is the first principle of checking uptrend). But this is very short term and there is a strong resistance at the top marked by the trend line. Unless it decisively breaks that, I wouldn't go long in a hurry. In any case, Banking sector as a whole has just too many uncertainties these days and it is affected not only by RBI but ECB/FED and bond yields of even tiniest European countries. Only a brave heart will take a long term position here.

ITC:

Isn't it a beautiful chart. Has been going up consistently in spite of increased taxes on Tobacco items. ITC actually is a very diversified company from Hotels, FMCG to what not and it is very very difficult to find the fair value of this stock by fundamental method. Though the slope of the rise is not extraordinary the consistency of the rise in a volatile market is worth a note. It is just about to approach over bought condition and might see a piddly correction. This stock is for someone who is an investor and less for a trader.

Hope you will excuse me for not making a trading post and have enjoyed the charts here. Will get moving with the next post on Moving Averages and will also keep my eyes open for any suitable trading post. Keep the comments coming, they help me get back to writing.

Disclosure: No live trading position in any of the above stocks. Have a small no of RIL shares which are held since few years without any short term interest.