In our latest post, we highlighted the outperformance of Small-caps over large caps and shared a few ideas that we thought could perform well going forward.
Here is part 2 of the Small-cap actionable ideas. Let's see take a look at the names that have made the cut!
Nifty Small-cap 100 has been moving past crucial resistances. As can be seen from the chart below, we're tracking 7,850 as the risk management level with 9,650 acting as the next target.
In no market can prices rally without minor corrections, so as long as this index is trading above 7,850, our bullish view remains intact.
Small-Caps are now the flavour of the season, or at least of the current market setup. With these stocks outperforming the broader market, we took a look at some stocks that could be actionable trades with good risk-reward ratios.
We've broken down this post into two parts to do justice to the number of ideas we're observing right now.
As the Small caps continue to outperform the market, the constituents belonging to this segment are expected to generate greater returns than the large-caps.
For now, it looks like this index is moving about in a market of its own. The next target that we're tracking is 9,650 and the risk management level is 7,850.
Click on chart to enlarge view.
Now let’s take a look at some actionable ideas at current levels that look attractive on the long side for the next few weeks and months.
The Outperformers is our newest scan that pinpoints the very best stocks in the market. It’s the fastest, easiest way to find quality names that are primed for major moves.
The goal is that as the market rally progresses, the sector rotation within the market will reflect in this scan. So while our Top/Down Analysis helps us with the broader view of the market, this Bottom/Up scan makes sure that we catch the slightest change in sentiment.
We retired our "Five Bull Market Barometers" in mid-July to make room for a new weekly post that's focused on the three most important charts for the week ahead.
This is that post, so let's jump into this week's edition.
Over the past few days, the narration around Bonds has really caught on. With bond yields across the globe recovering sharply from lows, there are a lot of questions about the current stock market rally, the impact of bonds on the bull-run, whether we should prepare for a sell-off etc.
Let's try and address some concerns through this post where we talk about the impact of bonds and the US dollar on the ongoing stock market rally.
Let's assume we know nothing about the correlations in the market and are basing our view on the simple activity of observing the historical price action and its subsequent impact.
Here we have India's 10-year Government Bond. When we look at the extremes of the movement, which comprises of the high and low clocked in the 2008 crash, the range lies between 9.30-5.25. Since then for 12 years, the range hasn't been breached and if this was any other chart with the name stricken out, one would say it's going sideways.
In the chart below, we have highlighted three instances where the bond yield has bottomed out and rallied. This has happened in 2009 and 2017 in the past. Can we expect the same in 2021?
Here we go with our next round of the Top-Down Take post. At All Star Charts, we like to keep things simple and look at the bigger picture. We let the charts speak to us and then decide what to do. Always remember, the Trend is our Friend.
Today we’re taking a look at a sector that has been an outperformer in the recent past despite broader market correction. Nifty Metal is now moving from strength to strength as more constituents break out of long-term bases.
We've been talking about Commodities and a possible upcoming supercycle in this asset class.
The reason we're inclined to this view is that we're seeing signs of this on several different charts across the globe. Now when that happens, we've got to sit up and notice.
Remember when the unthinkable happened and Crude Oil traded below zero? Entertaining as it may be (to some) such extreme readings on the chart tend to act as signals for the future.
Take a look at the chart below. It is the S&P500 relative to the inverted ratio of the CRB Index (Cap-Weighted Commodity Index). The long-term chart below suggests that the extreme negative readings that we saw in Crude Oil seem to have probably sealed the top in this ratio. Can Commodities begin their outperformance going forward? It's quite likely. The individual constituents certainly look like they're ready for a good move!
Introspection is a great quality to have. While a lot of introspection goes into life in general, many market participants fail to identify their errors because they do not review their actions in the market. The one thing that needs to be clear is that no new money is being created in the market. The money is simply shifting hands.
This week we're looking at two long setups from the Energy space. Nifty Energy has performed well and its time to start observing its constituents more intently.
We retired our "Five Bull Market Barometers" in mid-July to make room for a new weekly post that's focused on the three most important charts for the week ahead.
This is that post, so let's jump into this week's edition.