Archive for August 1st, 2012

The Sensex 30 Signals - II

Inter market divergence between BSE 500 stocks creates opportunities for investment and divestment. Stocks fall too much and become inexpensive (ready for accumulation) and stocks rise too much and become expensive (ready for distribution). Just like inter market divergence in BSE 500, divergence happens in SENSEX 30 also. This is why even if Sensex moves for 5% in a year there are stocks delivering 50% during the same period. This is what is happening and will happen in a small group of blue chips too. Now one might call it strange, but there are always buy and sell signals; we just need to understand where to look for them; and of course we also need to hold them.

Today we cover the rest 15 of the SENSEX 30 components. Our two filters based on price and Jiseki were able to capture gains in SUN, HDBK, ITC and L&T. The stocks have delivered 31%, 37%, 28%, and 37% year to date. On the other hand there have been clear negatives like Reddy, Bajaj, Auto and Bharti. All the signals which are positive on prices and cycles continue to be in BUY mode. Enjoy the latest ALPHA.

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Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Coverage India: CNX100, BSE500 traded stocks and Indian Indices.

Domnita Pascut is the founding member of Orpheus Capitals.  Her interest in charts and market patterns was an extension of her keen understanding of social mood and sentiment. How charts could say so much intrigued her. She worked on market patterns, economic research, cyclicality and economic history. It was her liking for history which helped her see the cyclical natures of markets and patterns. Domnita now spearheads the extreme reversion anlaytics developed at Orpheus. She uses Jiseki Performance cycles and combines them with various risk metrics to analyse markets and filter out trading signals.