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In this article let us analyze 5 India stocks that are technically bullish
for the medium term. The discussion is based on weekly charts.
The company was promoted by the well known Mittal family. Lakshmi
Mittal, the eldest of the Mittal brothers is the fifth richest person in the
world, according to Forbes magazine. He branched out in 1994, taking
over the international operations of the group. Pramod Mittal and Vinod
Mittal look after the steel business in India. The company produces
sponge iron, hot and cold rolled coils, galvanized and colour coated
sheets. Sponge iron production capacity is 1.6 million tonnes per year
while hot rolled coil steel plant capacity is 2.4 million tonnes per year.
http://groups.google.com/group/theindiastreet/web/ISPATIND_100907.j
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Ispat Industries reported a net loss of Rs.9.5 crores for the financial
year 2006 – 07. In December 2005 the company had revised the
capital structure of the company. 40% of the equity share capital of the
Company was converted into 0.01% Cumulative Redeemable
Preference Shares (0.01% CRPS). After it was relisted, it made a high
of 25 in April 2006. Within about two months, it fell to a low of 10.10.
The stock gained reasonably in the next 6 months and touched a high
of 17.90 in January 2007. After almost 8 months of corrective
decline/consolidation, it broke its resistance with record volumes last
week. The stock is expected to test its previous high at 25 soon.
Medium term target works out to 29.
The stock continued to make lower highs and lower lows since May
2006. The first wave in medium term charts apparently ended in May
2007. After a four month correction/consolidation pattern, the stock
had broken out this week with reasonably good volumes. Please note
the “three inside up” candlestick pattern prior to this week, formed at
support levels. The stock’s next resistances are 452 and 530.
This stock has made a few “V” like patterns, two of which are shown
above. ‘V’ formation is generally considered to be a quick reaction by
the crowd to offset the steep fall in prices; Technical traders prefer a
cup and handle type of pattern instead of this pattern. The stock has
broken its resistance at 71.50. This has happened after 4 months of
decline. Note the huge “upward gap” or “rising window” in the last
week’s price. This gap, should act as a support in case the stock
corrects from the current levels. The stock is expected to test its
resistances at 88.40 and 97.
The stock had fallen from a high of 227.10 in August 2005 to a low of
91 in June 2006. It has been bullish since then, though it nearly tested
its support levels. In June 2007 it did break its resistance but without
much volumes. It got corrected slightly and now, it has almost come
back to its previous close at 174.10. This confirms bullishness. The
stock is expected to test its resistances at 212 and 227.10.
Sundaramurthy Vadivelu
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