In part 1 of the review I had mentioned that the following stocks need to close above their resistance levels:
Ind Swift Laboratories Limited: 63.40 (Current: 57.15)
Omax Autos Limited: 94.70 (Current: 85.70)
Indiabulls Real Estate: 420 (Current: 368.20)
We also discussed in part 2 of the review about the following stocks.
Jindal Photo Limited: 122.30 (Current: 110.15)
Punjab tractors Limited: The stock lost 9.76% on a weekly basis. Bearish engulfing pattern has been formed in weekly charts. However, as I said on many other occasions we will wait for a confirmation next week.
Pochiraju Industries Limited:
I mentioned that “Watch the consistent decline from 23.05.07 after the “gap” day. This shows that the crowd is not interested at all in the stock now; But the technical analysis theory suggests that this type of formation is usually highly bullish.”
The stock gained about 6.50% on weekly basis. The harami pattern in weekly chart needs confirmation next week. On 12.06.07 stock closed at 22.65 and on 14.06.07 it closed at 26.55 or about 17.2% gain in two sessions. However a bearish engulfing pattern in daily chart needs confirmation on Monday. The low at 21.50 remains unbroken; this gives us hope that stock will move up further.
This week we will discuss about the following stocks:
APAR INDUSTRIES LIMITED:
The stock has been consolidating around 160 level for more than 2 months now. Its previous high of 170 was broken on a closing basis on 29.05.07. On 31.05.07 a “falling window” (Japanese) or “downward gap” was observed. Now this gap acts as a strong resistance. The stock is just about to enter its 5th wave. Between 11.04.07 and 08.06.07 the highest recorded volume was 12.372. On 12.06.07 at NSE, 358,302 shares were traded (nearly 29 times its previous high volume). No block deals were reported at NSE. This gives us a clue that there is some activity about to begin in the stock.
Once stock breaches resistance at 178.50 we can expect it to reach 199.50 and 219. However, first it has to break the falling window at 174.45.
Bharat Earth Movers Limited (BEML):
A double bottom has been formed in the daily charts between 26.04.07 and 11.05.07. This indicates bullishness. Further, it broke its resistance at 1120 on 15.06.07. Any decline in the stock could be a good opportunity to enter. The next targets for this stock are 1260 and 1386.
Lakshmi Vilas Bank:
After hitting a high of 117.55 on 07.02.07, stock has fallen to 80.70 or about 31% decline. It is getting consolidated for the last two months. The low at 73.55 on 11.01.07 has not been broken on a closing basis yet. The next higher low at 76.90 has not been breached on closing basis either. This indicates the stock is bullish. It has to close above 83.70 in daily charts. If it does, the upward targets for the stock are 94.75 and 100.
AZTECSOFT LIMTED:
In Top 10 cheapest India stocks we discussed about stocks falling 50% from their previous high. This is yet another example. The stock has fallen from its all time high of 237 on 13.03.06 to a low of 87 on 15.05.07 (about 63%). This level of 87 was breached and stock closed below it at 86.35 on 12.06.07. Bullish piercing line pattern was immediately formed on the next day, indicating possible strong support at this level. The bullish pattern was confirmed by a positive close and green candle on 14.06.07.
It is true that the stock is available at bargain prices. However, even if we consider this candlestick pattern as strong support, it will be the first wave only. Sometimes first wave is extended; many times it is short. A daily close above 104.90 will give the confirmation. It is better to enter the third wave, as many people consider it to be the best method.