Signs of market reversal

indi009 wrote:So what is the conclusion??? Will the market go down or the market will fireup like a rocket???????????

Because pls undrstand that there're people in this forum who doesn't understand the charts and stuff.......

Please............

@ Indi; my personal target is 7500, even 7200-7300 there is a possibility for a correction. And if it make a correction on this stage, I definitely like it, because its more healthier and sustainable, and we can buy more at a discount.. And most importantly, don't worry about ASI, keep look at the charts, news of your stocks in your portfolio, it tells you everything not ASI. So, concentrate on the core its keeps your mind simple and free  
I do these readings like we talking about politics, global economy, EU crisis (රටේ නැති වල්පල් ) blah blah when a set of same minded people get togethered, they discuss, argue with each others... That's their mind set and they enjoy from it>>>

Thanks Akalanka

What I notice was we are having nice pullbacks and short term pause or minor volatility in stocks time to time. When some sectors and stock become active some other sectors/ stocks becomes inactive.

Examples:

Behaviour of ELPL

Initial active trend from Rs.17 onwards. Short term minor volatility/pause below Rs.20 and then break out with key psychological barrier Rs.20 with large volume and then went up to Rs. around Rs. 26 to 27 levels. Now it is trading around Rs.25/- in low volumes and having a minor volatility and pause I am waiting to see what is happening next?

COMB some strong activity around Rs.100. Went up to Rs.110/ had some minor volatility and with pause. Gradually this process continued until around Rs146. traded for a while below Rs.145. Broke key psychological barrier Rs.150 with large volume and now it trading around Rs.160. I saw some weakness on COMB on Friday. So this process should continue as long as major uptrend in intact.

Next week at least first two days stocks such as COMB and JKH might have pause or some weakness. Sectors such as Banking and Finance, Diversity and investment trust and power, hotels and energy sectors may be dull and might see some weakness. On the other hand other sectors such as
Health, production, food and plantations might have some life. Those inactive stocks in many sectors also should become active next week onwards. Have a nice week end!

What I see is that market corrections will take place with the movement of policy rates. Until the next Jan policy rates will remain at the lower level to enhance the private credit growth to economic development. However, though CBSL is striving to keep the interest rates lower at the moment, since it's an artificial effort, rates will move upward after the next presidential election. As a result, investors in the equity market will move to fixed income gradually and equity market will have a gradual decline. Therefore, past trends will not arise as it is. All depends upon political and economic factors.

EWML you are correct

Thanks experts

VALUEPICK wrote:What I notice was we are having nice pullbacks and short term pause or minor volatility in stocks time to time. When some sectors and stock become active some other sectors/ stocks becomes inactive.

Examples:

Behaviour of ELPL

Initial active trend from Rs.17 onwards. Short term minor volatility/pause below Rs.20 and then break out with key psychological barrier Rs.20 with large volume and then went up to Rs. around Rs. 26 to 27 levels. Now it is trading around Rs.25/- in low volumes and having a minor volatility and pause I am waiting to see what is happening next?

COMB some strong activity around Rs.100. Went up to Rs.110/ had some minor volatility and with pause. Gradually this process continued until around Rs146. traded for a while below Rs.145. Broke key psychological barrier Rs.150 with large volume and now it trading around Rs.160. I saw some weakness on COMB on Friday. So this process should continue as long as major uptrend in intact.

Next week at least first two days stocks such as COMB and JKH might have pause or some weakness. Sectors such as Banking and Finance, Diversity and investment trust and power, hotels and energy sectors may be dull and might see some weakness. On the other hand other sectors such as
Health, production, food and plantations might have some life. Those inactive stocks in many sectors  also should become active next week onwards. Have a nice week end!

What you predict was correct. we are seeing a weakness in JHK and COMB today.

bulls really strong.COMB itself down by six but market is healthy.Trades reduced nicely from fridays 17000 to resist the bull.Tomorrow morning better buy few.

thanks experts... i am learning from you

Don’t worry much about market pullback, weakness, volatility, news, gossips etc. Once market form its major uptrend we cannot predict top. Similarity we cannot predict bottom of the bear market. It is better to do some home work these days because we may have some great opportunities in market weakness and pull back.

I was able to go through another broker valuation guide and found some interesting numbers.

Intelligent investors make use of ROE to pick some of the great stocks in the market..

The basic criteria to identity some great stocks in the market

1. Return on Equity > 15%
Indicates high profitability and potentially a competitive advantage
2. Debt-to-Equity ratio < 0.5
Implies that the company does not heavily depend on outside capital to finance its growth
3. Current ratio > 2
Makes sure that the company is able to pay its short term obligations

Some stocks with attractive ROE.Some of following have nice debt to equity ratio too. Eg.UDPL

ASPMN, ELPL, UDPL and NAMU have ROE over 15%

AHUN around 15%

ONAL over 22%

TYRE over 22%

SMOT 26%

LGL 20%

TAFL 19.02%

NEST one of the best ROE in the market

AEL 18%


Positive factors

Lower oil and gold prices
Lower raw material prices
Improved weather
Improved tea output
Improved tourist numbers
Trade agreements with China and Japan
More grain harvest in the coming months and quarters
Falling Grain prices globally
Lower interest rate

Thanks VALUEPICK
your are real Expert

you all Chart experts , you da real MVP s

I think market reversal is mainly due to external factors. No such effect now

Presently external factors are favorable For example agreements with china delegation

There may be ups and downs due internal problems of individual companies. That is the normal behavior of any stock market

If govt authorities do not interfere stock market nothing to worry
Even manipulation by private sector is not a big problem Biggest problem is govt manipulation using public funds as in case of 2009 to 2011

I think govt has learned a lesson after Indrani Sugathadasa effect. That was individual behavior and not market behavior

Market reversal as expected may bit slow down with the declaration of new price structure of fuel today. Savings from transport cost should benefit the common people...Question is how long that reduced prices survive...

With the political pressure for the next year presidential elections. We may see many economic positives in the next few months.

Which will directly affect the market trends. I don't think the current government will let the market down for any reasons as it will negatively reflect on their strategies.

So. I don't think there will be any major draw back other than minor correction until the elections are over.

I believe today’s red stocks will become tomorrow’s dark green stocks. Some stocks including some market leaders such as CHMX, JKH, MASK, WATA, RCL, LWL, SAMP, and COMB were active today. Some momentum stocks also were active. There may be some hidden gems as well. If we can find out one hidden gem with great prospect then it is more than enough to cover losses we made in the past. I think UDPL in the plantation sector is a hidden gem. Do you think so? When bull starts even negative factors will ignore.  For example there were lot of crises in Greece and Spain, unemployment in Europe, banking crisis in USA and Europe, Property crisis, political crisis in Middle East especially in Iran and Iraq at that time, gold and rupee crisis in India etc. Didn’t’ their stocks markets go up? There were bull markets everywhere. Even Pakistan had a good one despite their political crisis time to time.

My sectors under radar are:

Banking and Finance-
Power and energy
Plantations
Diversify
Food and beverages
Production

We will see some of the great winners from the above sectors. Actually some stocks are coming out of their base now. Then there are another set of stocks. Until accumulating is over we cannot expect rally for them in the short run.  Some have gone to second and third stage and still have some legs.

Good luck!

One red day two light green days.market getting ready for the next assalt

Yes, i saw HAYL is coming out of its den today. volumes are low. but i rate this stock as a silent giant. it wont move unless there is really something in the market. i hope i wont be wrong

nickjava wrote:Yes, i saw HAYL is coming out of its den today. volumes are low. but i rate this stock as a silent giant. it wont move unless there is really something in the market. i hope i wont be wrong

You are right. Gradually market is getting strong due to some bull indicators. Good luck!