Stocks for the long and short term portfolio
- Thread starter jamit_05
- Start date
BHEL Hit 2006 Lows with huge bearish momentum!
I would be scared to buy now.... I don't care what any Excel sheet in the world has to say. I would want at least a double bottom on a monthly chart to make a purchase.
Looking from another angle. The early investors are not really shaken because their price of purchase is unbelievably low. Make a guess what it is and then look at the chart below.
You see the biggest volume bar... that is at Rs.17 !!
That is how REAL money in the stock market is made. Buy low, very low and hold for a decade or two !
I would be scared to buy now.... I don't care what any Excel sheet in the world has to say. I would want at least a double bottom on a monthly chart to make a purchase.
Looking from another angle. The early investors are not really shaken because their price of purchase is unbelievably low. Make a guess what it is and then look at the chart below.
You see the biggest volume bar... that is at Rs.17 !!
That is how REAL money in the stock market is made. Buy low, very low and hold for a decade or two !
Investors please make note.
BHEL fell by 29 points yesterday, biggest fall in 52 Weeks... and investors were serious about it. This is shown by the largest volume bar, also in 52 Weeks.
So now, there are two ways from here. Either it was an exhaustion, the final spurt, from where the price will consolidate or reverse
Or
This will see a continuation.
Lets see what the days unfold. If there is follow-up fall then much more downside is likely. This will show unprecedented levels, which will be met with purchase from true, honest and loyal long term investors in the future of this company.
BHEL fell by 29 points yesterday, biggest fall in 52 Weeks... and investors were serious about it. This is shown by the largest volume bar, also in 52 Weeks.
So now, there are two ways from here. Either it was an exhaustion, the final spurt, from where the price will consolidate or reverse
Or
This will see a continuation.
Lets see what the days unfold. If there is follow-up fall then much more downside is likely. This will show unprecedented levels, which will be met with purchase from true, honest and loyal long term investors in the future of this company.
Some honest folks are wondering whether it is a good time to get into MCX after this fall. Their Logic goes:
1. It is an established brand
2. With no competition
3. Regulated by the govt.
4. Company is generating Regular effortless income via Brokerage.
And now even the price is attractive. It is a win win situation. Right?
My take:
One legendary investor once said to the effect that if you ever find yourself in the spot where u r getting a very good deal, then ask God... Why me?
(Yes, I caught the sarcasm the moment I read it.)
There is always a catch in such things. The only entity I can rely on to take the best decision for me is:
Myself.
And if I don't understand someting, I wouldn't even consider going in. I will stick with cleaner areas of investing.
My verdict is to give MCX a pass (and FTIL). I have even stopped reading about them. I know enough to protect my money.
1. It is an established brand
2. With no competition
3. Regulated by the govt.
4. Company is generating Regular effortless income via Brokerage.
And now even the price is attractive. It is a win win situation. Right?
My take:
One legendary investor once said to the effect that if you ever find yourself in the spot where u r getting a very good deal, then ask God... Why me?
(Yes, I caught the sarcasm the moment I read it.)
There is always a catch in such things. The only entity I can rely on to take the best decision for me is:
Myself.
And if I don't understand someting, I wouldn't even consider going in. I will stick with cleaner areas of investing.
My verdict is to give MCX a pass (and FTIL). I have even stopped reading about them. I know enough to protect my money.
EiL and Union Bank, both PSEs and candidates for long term purchase are crashing!
They are very likely to survive the decade to see the next uptrend in their sectors. Union also gives regular dividends and will be quick to gain popularity. However, currently the way Union Bank is headed, it will touch its Issue Price of Rs.16 before it can go into an uptrend.
They are very likely to survive the decade to see the next uptrend in their sectors. Union also gives regular dividends and will be quick to gain popularity. However, currently the way Union Bank is headed, it will touch its Issue Price of Rs.16 before it can go into an uptrend.
Tata Power is a very good counter. Buy and Hold. But at what price?
It fell 9% today. But still not good enough. The whole tata group will come under pressure for cash due to their one singular mistake: Acquiring Corus.
One can bet that the group will survive to see the other side, but at a price. I expect to see tremendous fall in price in most of the tata counters. Tata and Sons will be pressed to sell their stake to finance Tata Steel, a money hogging behemoth !
Tata Chem
Tata Inves
Tata Motor
Tata Power
and finally TCS.
Are all very good companies... better than Gold. But be very bearish.... Will publish their levels soon.
It fell 9% today. But still not good enough. The whole tata group will come under pressure for cash due to their one singular mistake: Acquiring Corus.
One can bet that the group will survive to see the other side, but at a price. I expect to see tremendous fall in price in most of the tata counters. Tata and Sons will be pressed to sell their stake to finance Tata Steel, a money hogging behemoth !
Tata Chem
Tata Inves
Tata Motor
Tata Power
and finally TCS.
Are all very good companies... better than Gold. But be very bearish.... Will publish their levels soon.
Sure, I'd be convinced with 81 only if there is a few months of consolidation. Till then 16 is the only logical price.
Investors eyeing BHEL for the past year, entered at the super-strong technical support of Rs.200, but that didn't hold. Hence, I feel 81 for union won't hold either.
Don't mortgage your house. It will cost you interest. It might be a long time, around 5 years, before Union picks up after hitting issue price.
It looks easy, but when it is a question of putting lakhs of Rs. in stocks that have become dirt cheap and are unlikely to give positive result for next 5 years... lot of people back out at just the thought of it. Investing is tough. Be completely prepared to walk this path.
Investors eyeing BHEL for the past year, entered at the super-strong technical support of Rs.200, but that didn't hold. Hence, I feel 81 for union won't hold either.
Don't mortgage your house. It will cost you interest. It might be a long time, around 5 years, before Union picks up after hitting issue price.
It looks easy, but when it is a question of putting lakhs of Rs. in stocks that have become dirt cheap and are unlikely to give positive result for next 5 years... lot of people back out at just the thought of it. Investing is tough. Be completely prepared to walk this path.
It is not unusual for stocks in bad light and in under-performing sectors to reach issue price.
Look at the following
1. SCI (ATH Rs.332, now running at 27!)
2. Nalco
3. PFC (a favourite of investors in 2010)
4. Sail
5. Powergrid
I can recall these companies from the top of my head which have already reached their Issue prices or are a block away.
I mean, heck if PFC and powergrid can then Union can too!
But, most importantly, I surely cannot predict what market throws at you. For all you know, it may go back up again (with subba gone and Ranga in).
All I can say is that the bearish momentum is serious and monsterous. Issue price is a strong possibility.
This mental model of deciding price has helped me stay away from buying too early in several scrips including Bhel, SCI, Sail, TS and several others.
Look at the following
1. SCI (ATH Rs.332, now running at 27!)
2. Nalco
3. PFC (a favourite of investors in 2010)
4. Sail
5. Powergrid
I can recall these companies from the top of my head which have already reached their Issue prices or are a block away.
I mean, heck if PFC and powergrid can then Union can too!
But, most importantly, I surely cannot predict what market throws at you. For all you know, it may go back up again (with subba gone and Ranga in).
All I can say is that the bearish momentum is serious and monsterous. Issue price is a strong possibility.
This mental model of deciding price has helped me stay away from buying too early in several scrips including Bhel, SCI, Sail, TS and several others.
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