It's been a while since we've issued a Precious Metals update, so today we wanted to reiterate our risk management levels and targets on both the weekly and daily timeframes.

Last week we discussed the potential near-term "oops" in India's major indices and those conditions remain very much intact.

With that being said, today's focus is on one sector and its largest component, both of which look vulnerable to further downside.

Let's take a look.

One of the tools we use for Indian stocks due to how top-heavy the market is are chart overlays of a sector/index's largest component and the underlying sector/index. The largest component in most cases can represent a major portion of an index and act as either a helium balloon or lead balloon, pulling the index up or down on a whim. When their performance diverges, that's when we want to pay attention.

Over the last few months, we've seen a divergence in the performance of Vedanta Ltd. which represents 19% of the Nifty Metal Index. Vedanta is making lower highs as the sector makes higher highs, suggesting that potential weakness could be ahead the group as a whole.

Click on chart to enlarge view.

This week's Chart of The Week outlined a compelling case for the Pharmaceutical sector to bottom at current levels, so this post is going to outline the stocks we want to be buying to capitalize on this potential inflection point.

Going through our universe of coverage I noticed weakness in the Rupee over the last week, so this post is going to help put that into the perspective of the longer-term trend and outline how we're approaching it.

Thursday we looked at two lagging sectors that have been developing signs of a potential bottom like we saw in Energy, Autos, and others several months ago.

Today I want to follow up on that post by diving into the Nifty PSU Bank Index components to see if what we're seeing there supports the action that's occurring in the equally-weighted index.

In September we saw a massive spike in the number of new 63-day highs in the Nifty 500's components.

Today I want to take a look at look at the data and answer the questions how rare is this signal? and what are the forward returns?

The trend for NIFTY stocks is up. That has not changed. Like many stocks and indexes around the world, NIFTY been mostly stagnant since early 2018. Unlike most stocks and indexes, however, NIFTY has managed to put in higher lows and higher highs along the way. So it's not just a consolidation.

I do believe NIFTY resolves this consolidation higher and heads up towards 13,000 - this is the target:

Today we're looking at our updated Monthly Chartbooks to identify the structural trends in India's major indices, sectors, and stocks.

We continue to see prices in the major indices bounce as breadth and momentum divergences remain intact, however, many of the trades we've outlined have moved away from their optimal reward/risk level.

Today we're outlining stocks we can be buying today, or in the near-term.