The below gives a brief overview about the 17 page report “The Financial Waves Monthly update” This report has almost 18 charts that covers Indian heavy weights and Global markets. For subscription visit http://wavesstrategy.com/index.php/store.html
Indian equity markets continue to flirt around crucial juncture. In the current research we are showcasing not only Sensex but also charts of heavy weights from index – Reliance Industries, L&T, Tatasteel, ICICI Bank, Tatamotors, Infosys. All of these charts are shown in a single page with striking similarities between the first 4 charts and breakouts that has already happened in the latter 2 stocks. These 6 charts are sufficient to derive the overall structure of Sensex and why it has been approaching near life time highs but is yet to give a clear breakout. The plausible wave counts are evaluated with crucial levels that need to be broken along with strong momentum.
Sensex Weekly chart:
In previous update we mentioned about Sensex exhibiting series of negative divergences on the way up and so we were not bullish even if levels were broken. Our stand was vindicated andSensex moved down making a low of 20160. Now it seems an important low is in place and prices are again approaching towards life time high levels. However, momentum plays a very vital role in deciding this and we are keeping a close tab on price derivatives to get a leading indication.
Global perspective:The next section shows the charts of Germany major index – DAX, Hong Kong index – Hang Seng and Sensex. The DAX has been leading its way up all the while after breaking from triangle pattern with Hong Kong market given a breakout in November and Sensex is now very close to doing so. However patience is warranted and after good closing for consecutive 3 months if December can result into the breakout!
From fundamental perspective, we have evaluated Industrial Production (IIP) and its lagging or coincident behavior with equity markets. Many analysts have a tendency to look at IIP and forecast the future price action but we think that is absurd in similar way as we looked at why GDP data cannot be used to forecast future in previous updates. The worse of the GDP, IIP and other fundamental data comes near major lows in equity markets.
Banking index continues to move higher but we think its underperformance cycle is still ongoing atleast for few more months before it starts the strong leg on upside. Similarly the stock pick this time is Axis Bank and its multi-year path going forward. This stock also has the potential to increase multifold value for its share holder’s atleast till 2017.
This time we are showing Metal index instead of Banking index as it is looking more promising as of now. It seems Metal index has ended its underperformance and should strongly outperform going forward. The relative analysis of this metal index and its individual wave counts show why this index will move ………… for few months to come.
Lastly, Comex Gold and USDINR charts both looks to be in sync with Comex Gold after one minor leg down should move up for few weeks before resuming the multi-year of downtrend and USDINR should also move lower before completing the final leg on upside i.e. INR should enjoy a brief period of ………...
Each of the above factors are explained in minute details and justified with technical analysis on charts. We have applied right from traditional techniques to advanced concepts and tried to make it easy for anyone who would like to learn or trade or see the future of Indian economy. You can subscribe to “The Financial Waves Monthly Update” along with “The Financial Waves short term update” and get indepth analysis right from short time frame to long term targets. Visit http://wavesstrategy.com/index.php/store.html and get your copy of the research instantly delivered to your mailbox.
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