Multibagger Stock: Zydus Lifesciences up by 68% in just 6 months!!

We published about Zydus Lifesciences in August 2023 and predicted possibility of Multibagger returns in coming 2-3 years. Check out the research we had published on 23^rd August 2023 itself – This stock has managed to hold its gain and gave more than 68% returns in 6 months of span and made a life time high of 923.65 levels.

Zydus Life Weekly chart Anticipated as on 23rd August 2023

Multi bagger stock recommendation: Zydus Lifesciences

Buy Price – Buy at CMP 650 more on dips towards 560 level.

Time Horizon –2 to 3 years

Investment – 5% of capital

Target price –??

Stop loss - ??

Anticipated as on 23^rd August 2023– Elliott Wave Theory:

Zydus Lifesciences Limited, formerly known as Cadila Healthcare Limited, is an Indian multinational pharmaceutical company which is primarily engaged in the manufacture of generic drugs.

In the Weekly chart of Zydus Life, we can see that, stock is moving well within a multiyear channel. Stock has also formed a Rounding Bottom pattern and currently on the edge to give breakout. Usually this pattern occurs at the end of the downtrend. This time it is making an exception by forming on the top. However, breakout is still pending. For short term we expect some consolidation before breakout as it will give time for RSI to cool off. After which, fresh breakout is expected.

As per wave perspective, currently primary wave 5 is ongoing on the upside which is subdividing in nature. The stock is following 89 Period cycle really well. As it has managed to capture almost all the important lows. The recent low formed near 320 levels was near our cycle and since then we witnessed a good rise which is in form of intermediate wave iii.

Zydus Life Daily chart Happened as on 29h February 2024

Happened– The stock has been moving in sync with our expectation. Stock made a dip exactly near our mentioned levels and from thereon we saw a sharp bounce on the upside. Stock has shown a really good rise of overall 68% from the lows in just 6 months of span!!! It has touched its fresh record high near 953.65 levels recently and currently it is quoting near 935 levels. The overall up move has been strong and we expect prices to achieve its target of...levels in coming months.

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Nifty Sharp Selloff Below 22k? Time to be Cautious?

Nifty had a sharp fall and prices broke below 22000 levels as well. This comes along with strong negative divergence on momentum.

Is it time to sell?

Let us look from Advanced Elliott wave – Neo wave perspective!

Nifty hourly chart: 

As shown on above hourly chart, prices started to move higher from the lows of 18838 and showed strong trend in December and early January 2024.

Post that the volatility has increased and we are seeing rise in the size of Candles as well in either direction. Such sharp volatility is not good for uptrend and indicates anxiety among participants.

From Neo wave perspective – the recent rise looks to be slower and corrective that is trapping both bulls and bears on either direction. This type of trap is usually a result of Triangle pattern.

We are revising our wave counts to accommodate for the recent price action and it suggests that post completion of wave x near the lows of 21137 the rise is in triangle pattern. Within this wave c is probably complete and we are not falling in form of wave d. Prices are exactly at the trendline support and breach below it will open the downside targets for 21520 or lower.

On upside 22060 followed by 22200 is immediate hurdle.

The ongoing pattern is most probably triangle and further price action will confirm the above scenario.

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Trading KST momentum indicator with Keltner Breakout on Nifty

Nifty touched lifetime high levels and showing some loss of momentum from there.

Using momentum indicators along with breakout techniques that can help in capturing the entire up move is important.

Nifty 15 minutes chart: 

In above chart of Nifty we can see two important indicators that are focused on prices and momentum.

Keltner channel – This indicator is different than that of Bollinger Bands®. Bollinger Bands uses standard deviation to the mean whereas Keltner channel is derived using Average True Range (ATR). Both of the indicators have different way of application.

In Keltner channel we can see that break above upper channel on 22^nd February which was the 1^st break above the upper band of Keltner. Post that prices are moving within the bands indicating it is only a retracement of the up move unless we see breakout below the lower end of the Keltner channel.

KST momentum – Breakout on Keltner channel was also accompanied by KST momentum indicator. KST momentum indicator broke above 0 line and also the signal line thereby giving strong confirmation that momentum was picking on upside.

In entire up move prices have not moved below the lower Keltner channel and KST if now again moves back above the 0 line it will indicate a positive reversal. This can be a pause before the resumption of trend but a classic signal can be expected when both these techniques again get synchronized.

In a nutshell, Keltner channel helps to understand if the size of candle is increasing which is suggesting a significant move and KST further provides confirmation of momentum. Price action above 22150 which is mid of the channel will result into another synchronous signal from these indicators.

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Hurst’s Time Cycles working across all Time frames, which one to select?

For a cycle practitioner the most important aspect is to understand that there are multiple cycles nested together. Prices behave in a cyclical fashion and cannot be independent to it. Everything in nature and financial markets is governed by cycles right from the Solar Cycle which is 11 years, Lunar cycle of 28 days, Seasonal cycle, Economic Kondratieff cycle of 54 years, Decennial cycle 10 years, Presidential cycle of 4 years and many more.

It is our effort to understand the various cycle currently being active on the given asset class and see where we stand with respect to them.

The simplest way of cycle identification is to see if there are low being formed in systematic fashion. There are various tools available to Detrend the prices and understand the underlying cyclicality. J. M. Hurst’s has brought forward Hurst’s Cycle analysis which has opened up another realm of looking at markets and timing it right from the smallest time frame to the biggest degree.

We are not getting into the science of cyclicality but will show the application of these cycles after careful evaluation and synchronization. Let us begin by looking at the bigger degree cycles first and scale down the hourly charts.

Below is the chart of Nifty picked up from the Monthly research report 

Nifty has been forming lows every 85 weeks. We can see that the crash seen in 2008 also formed a low on this time cycle. This later followed by multiple major lows forming precisely after every 85 weeks.

This shows that prices are following the rhythm of 85 weeks. On two occasions – one in 205 and another in late 2021 prices formed a top instead of a low. This we call as Inversions where tops are formed and not lows. This happens rarely and indicates bigger cycles are topping out.

Covid 2020 – Nifty showed one of the best rallied from last week of March 2020 till 2021. This rise happened despite of Covid wave 2 hitting everywhere which was much more intense and strong. However, prices continued to rise as the time was right and this is the proof that shows when time is in favour events does not matter.

June 2023 – We have talked about this cycle more than a year prior to Jun 2023 and mentioned how we can start the mother of all bull markets in the year 2023. We can already see a rise 16900 levels to beyond 22k which is more than 5000 points on Nifty and whopping 31%.

The above clearly shows the edge that one can get by seeing the Time cycle and the rhythm of market as it moves. The next cycle is going to be due in February 2025 which will be another opportunity for long term bet on “Bharat” to ride the ongoing “Mother of all Bull Markets” – Are you ready!

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Nifty Hits Lifetime High, Intraday Trading Timing the Market

Nifty hits lifetime high – Is it possible to time the market?

Yes, using the concepts of Time cycle it is possible to identify the exact date and time when we can expect a reversal to happen.

Time cycles shows the possible reversal areas and the same has to be combined along with Price action to derive high probability outcome.

Below chart of Nifty and Bank Nifty was shown during live webinar with 1000s of participants with the date and time of reversal that too on a 15 minutes time frame.

Nifty 15 minutes chart – Anticipated on 13^th February 2024 

Nifty happened: 

Bank Nifty 15 minutes chart – Anticipated on 10^th February 2024

Bank Nifty Happened:

Time cycle Trading - Above chart of Nifty anticipated was shown on 13^th February before the Gap down on 14^th February. The Time reversal was mentioned as 9.45am. Nifty had a big Gap down opened near 21550 and then made a low at 21530 levels that too on time at 9.45am. From there prices rallied sharply on the same day and continued the up move even beyond 22000 levels.

By combining price action with time cycle one could have entered around the area of 21580 – 21600 levels as both prices and time confirmed from there much before Nifty touching the lifetime high levels beyond 22120 on 19^th February 2024.

Bank Nifty Time cycle -  Bank Nifty anticipated chart shows the forecast of time on 13^th February 3pm. At this time there was no positive price confirmation above the swing high. Next day prices had a sharp Gap down opening and reversed the hourly candle on upside. This also happened from near the time zone period. So a positive price action on Bank Nifty with time resulted into an up move from the lows of 44890 to the highs of 46670 – a move of nearly 1800 points in just 3 trading sessions.

In a nutshell, by combining time forecasting technique along with price action, Nifty gave a move of more than 600 points and Bank Nifty showed a move of more than 1800 points. This only shows the power of proper application of Price Time together. Also note this is not 100% sure shot. It is prudent to apply stoploss and lose less when it does not work and make a killing when it goes in favour.

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Elliott wave – Neo wave application with Hurst’s Time cycles on Nifty chart

Advanced Elliott wave – Neo wave helps to understand the overall maturity of the trend and provides the probable path prices can follow.

It is important to combine the application of wave theory along with price action for a clear trade setup and to stay objective.

Nifty Neo wave daily chart with Hurst’s Time cycles:

Elliott wave analysis:

As shown on above chart, prices are moving with high volatility since the top was formed near 21118 but moving in a broad range.

The movement on intraday basis has also been wild and it is important to combine the wave patterns with simple 3 rules of price action to stay objective.

As we can see in above chart post completion of wave (e) there was sharp decline on downside that hinted for possible completion of the up move and reversal on downside in form of wave (f). This wave (f) is supposed to be similar to that of wave (b) and show both price and time correction.

We can see that Nifty have been failing to show price correction since past few weeks but is showing time correction. This keeps the possibility still open that the downside move in form of wave (f) has started which might be possibly in Diametric pattern.

To ride the downside reversal we now need to see a faster retracement of the last rising segment which is from the lows of 21530 levels on short term charts or a reversal as per the 3 candlestick rules can be an early warning for prices to move back on downside.

Any breach above 22055 followed by 22118 will increase the possibility that wave (e) is not over but will take prices up trapping late entrants and then reversing back on downside. Given the recent price action this possibility has now opened up.

Hurst’s Time cycle – As per the concept of Time we are now near 75% if the cycle period. This is also the reason we are not seeing strong positive behaviour as time is not in sync for positive momentum yet.

In a nutshell, Nifty is now near the cusp with acceptance above 22055 to open the odds for wave (e) to continue whereas reversal on downside as per the 3 candlestick rules will indicate downtrend. These are times when just two days of more price action will confirm the pattern under formation with utmost clarity!

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Paytm shares crash 10% again, Is it Time to Buy?

Paytm shared crashed by more than 65% from the highs and it is locked in lower circuit of 10% again.

Where will the stock bottom out and is it right time to buy?

It is best to look at charts and the possible area where the stock can bottom out using concept of Time cycles and Price action.

Paytm daily chart with Time cycles:

Paytm shares are down sharply since January 31, after the RBI imposed its restrictions.

Hurst’s Time cycle - We have applied Time cycle of 57 days on the chart that shows the lows on the stock is formed around this time area on most of the occasions. The next low as per this should form around 6^th march 2024.

The support on downside is also at 280 – 265 which is derived using Channeling technique. We can see that the prior lows are formed on the lower trendline of the channel in the past.

As of now it is best to avoid buying this stock and when we have a positive price action near 280 – 265 along with the right time it will be a good opportunity to enter into the stock.

In a nutshell, by combining Hurst’s Time cycle concept along with Price action changeling technique one can forecast time of reversal with a complete plan. It seems there is more room on downside for this stock and it is best to evaluate entering into it in 1^st week of March 2024.

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Scalping Trade using Time cycles on 5 Minutes Chart

Scalping trading means getting in and out of the market quickly and taking away the stoploss or profits very fast.

Time cycles can be applied even on 5 minutes time frame for scalping

It requires a clear understanding of charts and trade setups to do scalping trade even on 5 minutes time frame.

Below chart is of Nifty showing time cycles applied on 5 minutes time frame

Nifty 5 minutes chart

Time cycle application – Nifty time cycle applied on 5 minutes chart shows that most of the time prices are nearing this time zone there is a move on upside. There are swings as much as of 150 points as well.

During the downtrend when the daily trend is negative as per 3 candlestick rule these time cycles give pullback and providing opportunity eve on the sell side.

As can be seen in above chart on prior 3 occasions there have been pullbacks from the cycle period even during down moves.

For scalping it is one of the quick way to identify reversal areas and combining this with price action can provide classic trading opportunity with good risk reward trade setup.

As can be seen recently prices have shown upside pullback from near the time zone and now break below 21580 will provide sell side opportunity keeping the high of the candle as stop.

It is also possible to derive targets on downside using time indicator and other concepts of Hurst’s Time cycles.

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Nifty Trading – Alignment of Indicators Like Never Before!

Trading using Elliott wave – Neo wave and combining it with Hurst’s Time cycles is the best way to trade with low risk high profitable setup.

Bank Nifty is also sharply down on 8^th February post RBI Policy announcement. But the down move was evident and it is best to see charts rather than the news to trade.

Nifty has given breakdown from the 22k levels which was tested multiple times. Prices failed to sustain above it despite of RBI policy announcement.

Nifty Daily chart:

Nifty targets of 22118 has been set in November 2023 by forecasting wave (e) equality to that of wave (c) on basis of Diametric pattern guideline as per Neo wave. Prices moved precisely as expected and reversed from there.

We can see that post touching 22118 there has been multiple attempts to breach this level but there is no closing above it. Now we can see break below the important trendline support.

55 Days Time cycle – Time cycle provides confirmation that if the overall time is on buy or sell side. We can see that prices have entered into the second half of the time cycle which is usually the sell zone. Price confirmation with time is crucial.

Now that prices are giving away and Time has turned negative until 5^th March 2024 it is best to take a bearish stand as long as we do not see close back above 22k levels. On downside the immediate support is near 21200 and we will come out with clear path ahead on seeing the further price action over next few days.

Other time indicators are also aligned together which is not very often to see.

In a nutshell, we can see alignment of indicators on the sell side as long as the high near 22k remains intact and pullback can be temporary. We have been bullish all the way from Gann square of 9 low of 18838 and we turned cautious near 22118 which is playing out well!

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