Nifty View - DENIP Consultants - Jan 2012 - Dewang K Mehta

Dear All,

The down trend that started on the Nifty since November 2010 from 6300+ levels on the Nifty is under significant threat.


I, have highlighted the tops with the help of a black trendline in the chart below.

We at DENIP Consultants believe that if we see a close above the 5220 mark on the Nifty we could see this downtrend end. A close above 5220 would definitely indicate the beginning of a major up trend which could last at least a year/ year and a half.

However for the short term traders, it would not be a bad point to initiate some speculative shorts. We would advise investors to start deploying cash into banking and metal stocks provided we see a close above 5220.

Do feel free to post your comments / views on the Nifty & get in touch with us in case you need to create a portfolio to encash this rally.

Thanks,
Dewang K Mehta
DENIP Consultants Pvt. Ltd.
Disclaimer Post applies.

BAD Equity SIP Returns VS FD Returns

Dear All,

This is an interesting read by ET Wealth. I think during such troubled times they're trying to educate investors to stick with their SIP's instead of stopping them and to have faith in the Equity Markets over the long term. 

I totally support this process and believe that investors should show a little more faith in the time frame and the performance of the fund manager. Although the short term / near term for the Equity Market looks to be terrible, over the long run your Systematic Investments will work out just fine. 

A 27% return CAGR over 10 years is pretty impressive where clearly Rs. 1.2lakh was returned as Rs. 12.79lakh. 

Our view at DENIP is that we anticipate at least a 10% - 15% fall in the indices (BSE Sensex & NSE Nifty) over the next 1 quarter. We believe that all long term investors should look to add a Gold SIP to their Equity SIP portfolio as a hedge to the oncoming fall since in the worst case inflation linked returns around 6% will  persists and during such turbulent times (2008 crisis, 2011 EU crisis) higher returns to the tune of 20%+  can be expected. Following is an email we had sent to a client on the 31^st of October 2011 who had started investing recently:

Scheme Name	Folio No.	Amount Invested	Current Value	No. of Units	Current NAV	Profit / Loss	P/L %
HDFC Top 200 Fund	7228258/61	15,000.00	14,099.14	73.953	190.650	(900.86)	-6%
Reliance Regular Savings Fund	404120184465	5,000.00	4,744.64	171.952	27.593	(255.36)	-5%
DSP Black Rock Top 100 Equity Fund	2496587/94	10,000.00	9,298.50	102.142	91.035	(701.50)	-7%
Kotak Gold Fund Growth	1913261/95	10,000.00	12,415.69	959.859	12.935	2,415.69	24%
	Total	40,000.00	40,557.97			557.97	1%

The whole portfolio was saved only because of investments in a Gold fund. If you work on proper asset allocation, the return game changes completely.

Do get in touch with us if you're interested. You can call us on (022)40156688/99 or 9320496699/9320196699.

Thanks,

Dewang K. Mehta

DENIP Consultants Pvt. Ltd. 

Nifty View- October 2011 - DENIP Consultants - Dewang K Mehta

Dear All,

We have been bearish on the Nifty since July 30th 2011 and we even booked profits once around the 4750 levels. At the current levels of 5118, and with today's red tick in the market we are bearish on the Nifty again with a target of 4750. 

Following is a zoomed out version of the Nifty chart which clearly shows that we are in a range bound zone in a falling trend market.

The following chart of the Nifty is the zoomed in version of the range bound trade. Next Target on the Nifty is 4750. We need to wait and watch if 4750 is breached this time or do we find support and continue this range bound trade.

Thanks,

Dewang K Mehta

DENIP Consultants

Disclaimer Post Applies

Nifty View - DENIP Consultants - Dewang K Mehta

Dear All,

At the risk of sounding cocky, we are going to come out and say that we told you so. A lot of people got worried when we opened almost 3% lower this morning, some even started shorting the market. However if you would have followed our advise (http://denipconsultants.blogspot.com/2011/08/nifty-view-denip-consultants-dewang-k.html)  you would’ve been a buyer and not a seller this Monday morning.

Hope none of the people associated with us or reading this email or reading our blog went short in the market. We however strongly believe that the rally that comes in next will be a relief rally and that people should look for opportunities to sell the rally. Please be patient and opportunities will come knocking. (http://denipconsultants.blogspot.com/2011/08/what-do-you-do-with-your-sip.html)

Godrej industries had fallen down to 205 and we hope that some of you bought the stock as per the levels mentioned by us this past week (http://denipconsultants.blogspot.com/2011/07/godrej-industries-6month-buy-dewang-k_30.html).

Thanks,

Dewang K Mehta

DENIP Consultants

Nifty View - DENIP Consultants - Dewang K Mehta

Dear All,

The charts of the S&P CNX Nifty show that we have broken down from a descending triangle pattern with a gap down which usually is considered to be a strong down move. If a target has to be set then the first target for this fall would be 10% lower from the breakdown point which comes to 4815 - 4825 considering that the break down happened from 5361 levels.

We however believe that since we have had a 5% fall this week, we will spend the coming week consolidating and then the week after in a pullback mode. Ideally we believe that the pullback till 5360 / 5350 should not be ruled out in the coming 2 weeks. However the 5350 / 60 would be a good level to short again and this time around expect a fall till 4800 levels.

According to us large cap stocks such as M&M, TCS, SBI etc. of the world would be strong candidates for a buy since they would lead the pullback.

Our Previous Post: http://denipconsultants.blogspot.com/2011/07/s-cnx-nifty-still-bearish-dewang-k.html

Thanks,

Dewang K Mehta

DENIP Consultants

Disclaimer Post Applies 

Godrej Industries - 6Month Buy - Dewang K Mehta

Dear All,

In our previous post on Godrej Industries (http://denipconsultants.blogspot.com/2011/07/godrej-industries-6month-buy-dewang-k.html), we asked fellow investors to book out profits in Godrej industries on the 7^th of July 2011 around 222 levels. We advise you’ll to re-enter this stock below 207 levels for a test of 231 levels again. We also believe that the target of 250 is still intact.

If we are to consider yesterday’s close of 211, we have saved at least 11Rs or close to 5% in this month alone. I would ideally want to buy it around the 205 levels but I am not too sure if it will fall to those levels. Below 210 is a good entry for this stock but patience is a must.

Thanks,

Dewang K Mehta

DENIP Consultants 

Disclaimer Post Applies

Reliance Industries Limited - Dewang K Mehta

Dear All,

According to me, if there is one stock that impacts the Nifty single handedly then it would be Reliance Industries Limited. This stock has been in a large trading range which can be broadly stated from 850 to 1250 since the start of 2009.

Stocks that stay range bound for such a long time are best traded by the book wherein you buy in parts at supports and sell in parts at the resistance levels. So looking at this range ideally buying should start below 910 levels till 800 and selling should start above 1000 levels going till 1100.

We have highlighted the support and resistances zones in this chart too with black and red highlights respectively. With the S&P CNX Nifty placed in its support zone and with Reliance Industries too entering the lower band of its support with a close around 827 I believe that this stock should soon begin to impact the movement of the Nifty.

As mentioned earlier the prudent bet is to go long Reliance at 827 with a stop of 794 and a target of 958 for starters. However I would be ultra-careful while buying this stock because usually when a stock breaks such a large consolidating / trading range the up or the down moves are too heavy, too fast and too high. So even if you do decide to invest, buy in small quantities with the willingness to average it below 700 levels.

Following is the post to our S&P CNX Nifty view: http://denipconsultants.blogspot.com/2011/07/s-cnx-nifty-still-bearish-dewang-k.html

Thanks,

Dewang K Mehta

DENIP Consultants 

Disclaimer Post Applies 

S&P CNX Nifty - Still Bearish - Dewang K Mehta

Dear All,

This week the S&P CNX Nifty closed at 5482 which according to the charts is a very crucial level for it. A close below 5480 will definitely see us testing the 5200ish zone on the Nifty which takes it lower by at least another 3%.

What we have done is to go back to the basics of technical analysis which talks about supports and resistances. We have highlighted the resistances in red color from where the Nifty has fallen every time and the supports in black which are the zones where Nifty witnesses buying and bounces back.

So according to our reading of the charts we are very crucially poised and if you play by the book then it’s prudent to buy the Nifty at 5480+ levels and keep a stop loss of 5446 both being spot figures. However for traders who love going short we would advocate a weekly close below 5450 to go ahead and short the Nifty.

We began July with the Nifty at 5700+ when we had emailed and blogged about being cautiously bearish and we still continue to hold a bearish view on the market. However we are not ruling out a ultra quick up move to 5650 if buying does come in.

Our previous posts on the Nifty:

1. April 2011 - http://denipconsultants.blogspot.com/2011/04/nifty-view-denip-consultants-dewang-k.html
2. June 2011 - http://denipconsultants.blogspot.com/2011/06/nifty-view-denip-consultants-dewang-k.html
3. July 2011 - http://denipconsultants.blogspot.com/2011/07/s-cnx-nifty-cautiously-bearish-dewang-k.html

Clearly the above posts show how we have been bearish on the Nifty since 5900 and continue to maintain our view.

Thanks,

Dewang K Mehta

DENIP Consultants

Disclaimer Post Applies

S&P CNX Nifty - Cautiously Bearish - Dewang K Mehta

Dear All,

Please find attached herewith the Nifty charts. We believe that  the coming week could be very decisive for the Nifty and a weekly close in the red(negative) means that we resume our downward trend. A close below 5550/30 could very well mean that we test the 5450 levels soon.

We advise investors to hedge their long positions for the coming week where we see a potential downside. Resistance level for the Nifty is set at 5650/60 and the support levels are placed at 5560/5535. A close below the support levels takes us to 5450.

According to us 5500 – 5570 is a strong support zone but the international crisis could take us down.

Thanks,

Dewang K Mehta

DENIP Consultants 

Disclaimer Post Applies 

Nifty View - DENIP Consultants - July View - Dewang K Mehta

Dear All,

In continuation with our view on the Nifty where we did mention a possibility of a break out and we do seem to be in place now with the S&P CNX Nifty closing at 5728 levels. We believe that we should see at least 2 – 3 sessions in the green on the Nifty before we witness a pullback.

For now we should face resistance on the Nifty at the 5740 /5750 level and a close above that should take us to 5800 levels. However we do not rule out a pull back from the 5740 / 50 levels which could happen as early as Friday.

Please click on the image for an enlarged view.

Thanks,

Dewang K Mehta

DENIP Consultants Pvt. Ltd.

Disclaimer Post Applies

Nifty View- July 2011 - DENIP Consultants - Dewang K Mehta

Dear All,

Attached herewith are 2 S&P CNX Nifty charts. If you look at the charts then you will clearly see that the Nifty is facing stiff resistance at the 5720 – 5745 mark due to the resistance line (denoted in red) which has been pretty effective since November 2010.

Our understanding is that although it might be a good level to sell the Nifty, this time around the scenario might just be a bit different. If you look at the numbers then the FII have been buying heavily in our markets and the fall on Friday could be nothing more than profit booking. Monday might turn out to be a more decisive day than ever considering that we already have one close in the red. If we do close in the red on Monday with decent volumes then we might actually witness the Nifty fall back to 5555 levels where it should find some decent buying.

However a close below the 5555 level could essentially see the nifty fall back in the 5400+ region. We advise traders to keep strict stop losses on their long positions and could buy some puts to hedge their long positions. A 100 point fall on the Nifty from the current 5627 level could earn decent money on Puts.

The scenario does change if we do mange to close above the 5730/40 mark. We could have an upside that potentially extends till 6000 levels. If I look at the historical trend in July then the trend has been on the upside with the Nifty gaining a minimum of 100 points in the past 2 years or so. If I was to look at the indicators then all of them suggest that we are overbought but more often than not during a break out these indicators tend to be in the overbought zone.

This time it will be very interesting to see whether we break out or continue the downtrend considering that the FIIs have been buying heavily and the DIIs have been selling. Let’s see who wins this battle but for now trade safe and be light on your portfolio positions.

Thanks,

Dewang K Mehta

DENIP Consultants 

Disclaimer Post Applies

Nifty View - DENIP Consultants - Dewang K Mehta

 Dear All,

Attached herewith are 2 charts for the Nifty which clearly show that the Nifty is on the verge of breaking a major long term channel which was started in 2009. Although we did try to break this channel on the upside we seem to have re-entered this channel since Jan 2011.

We have taken support 3 times on the bottom end of this channel and we are again at the same level. We have been overbought every time the Nifty has tested this channel and this time too is no different. However judging the FII selling and global queues, I believe that we might break this channel on the downside. If 5340 is broken on Monday or in the coming few days, we might witness some major momentum on the selling side.

I would advise everyone to avoid trading the Nifty right now and if you would have gone short on the 5900 levels as per our last advise then book part profits at current level of 5366. 9% profit made in 2 months on the Nifty.

Thanks,

Dewang K Mehta

DENIP Consultants Pvt. Ltd.
Disclaimer Post Applies

Sensex trades with marginal gains; IT, capital goods up

The benchmark indices were trading with marginal gains amid volatility. Buying was seen in IT, capital goods and pharma stocks while metals, auto and select oil & gas stocks were under selling pressure.

At 14.57 hrs IST, the Sensex was up 50.62 points or 0.28% at 18427.10, and the Nifty was up 18.95 points or 0.34% at 5535.70.

The market breadth was negative; about 1294 shares advanced, 1453 shares declined, and 900 shares remained unchanged.

Positive contributors to the Sensex were Reliance, Infosys, ICICI Bank, L&T and HDFC. However, Tata Steel, Tata Motors, ONGC, SBI and ITC were negative contributors.

Top gainers on the Sensex were Cipla at Rs 330.80 up 2%, HDFC at Rs 671.90 up 1.85%, HDFC Bank at Rs 2,376.95 up 1.15%, L&T at Rs 1,731.50 up 1.14% and ICICI Bank at Rs 1,060.55 up 1.12%.

Top losers on the Sensex were Jaiprakash Asso at Rs 83.15 down 1.89%, M&M at Rs 657.50 down 1.45%, Hindalco at Rs 187 down 1.27%, ONGC at Rs 276.45 down 1.25% and HUL at Rs 315.60 down 0.85%.

Most active shares on BSE were Aanjaneya Life, Sun TV Network, SBI and HCL Tech.

Top percentage gainers on the BSE - Ram Ratna Wires, Jai Balaji Ind, NDTV, TV TodayNetwork and Systematix Corp were up 10-17%.

Top percentage gainers on the NSE - Jai Balaji Ind, NDTV, Berger Paints, TV TodayNetwork and Sujana Towers were up 10-16%.
source-moneycontrol

Stevenson
Management trainee-Fundamental analyst
Denip Consultants Pvt. Ltd