Anybody holding Gujarat NRE Coke should

TARGET: 195
RESISTANCE 185

- It is a triangle breakout, with huge Volumes.
- MACD supports the breakout
- RSI supports the Breakout



Feedback is appreciated!

Yes, it is a breakout.

What about the stop-loss...? .

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Difficult part

Stop Loss should be placed at 157(Previous top). Also using Trailing Stop loss policy is a must

That just shows the reduction in volume I believe...

I hv a couple of questions myself..
1. how do you arrive at the target price??please explain
2. Looking at the RSI..I has just moved above 70[over bought zone]
looking closely at the chart shows that the volumes are dropping once the RSI touched 70[upwards]...that makes me a bit pessimistic about the stock moving up further especially considering the current market scenario.,where a lot of correctionand /or consolidation is happening and thre is no proper direction seen!!

I am holding 200 @ Rs.110. I believe it is better to exit from this between 190-200
Please advise

- In a triangle breakout, the width of triangle in this case '65' is used to arrive at target price.

-Since trendline is passing at 185 before our target it is a major resistance.

- Moving into oversold zone doesn't mean it will not rise.

-Volume was decreasing when price was within chart marked between Pink lines
- Breakout followed with increase in Volumes.

If I were you I will use Traiiling Stop Loss to book partial profits.

Decrease in volumes with Triangle formation.

Thanks!

-My father recommended same to me.
- Saw it talked about on Monecontrol.
- Analyzed and thought of writing it here for reference.

would this be considered for the downside too, I mean if the break out happens on the down side..would the price fall to 65??

Very Correct! you got it right!

I appreciate the hard work you've put into your posts , but what is the forum's view of this stock as a medium to long term hold?

Are there any views on the promoters, and whether this is a momentum stock, etc., etc., etc.

Thanks once again.

I see a rounding Top Pattern in this share. Investors should actually seriously exit this share with every rise. this view will be negated if it firmly closes above 180.

This pattern symbolizes big guys are offfloading their stake slowly in this share and distributing same to retail investors.



- Further confirmation of this view is shown by negative divergence by MACD, it is refusing to rise with price.
- On weekly charts both RSI & MACD are showing divergence.
- The Rounding pattern is more clearly visible on weekly charts.

Fundamental Side Price Targets

FY 08

EPS growth on Yearly basis is estimated to 234%, but I am taking a safe target as 150%

GujNRE coke was trading at 40 Rs in March last year.

Thus Target price for this year is = 40 + (40*150/100) = 100 Rs

For FY 09

EPS growth is eatimated to 76%

Thus Price Target for next year is 100 +(100*76/100)= 176 Rs

So I guess you're saying that the price is way ahead of earnings if Rs. 40 in Mar. 07 is a valid anchor. The markets have just closed and this stock has gained quite a bit (13.62%) but this gain is in line with the type of stocks that investors the world over seem to be focussed on for the moment.
I got in on 31/3/08, 50 shares @ ~141.
I don't want to sell because I think mining stocks are a good bet but what do I know? I thought that the markets had bottomed out in Feb!

In post #3 of this thread, you recommended a trailing stop-loss.
How does one do this?

I have an on-line a/c with Geojit. So every morning, soon after the markets open, I enter a "sell order" at a price say 5 or 10% lower than the current rate.

If, I'm lucky and the scrip doesn't move down to that extent, I repeat the process each day?

I guess trailing stop-loss is not actually called that on the broker's site. So maybe I could do it (place the sell order at a price I hope it won't hit) based on the day's closing price as an off-market order.

Please try and make sense of what I've written!

My logic of Anchor price is, that all these estimates must have been done at financial year end in March, keeping price, business health in consideration etc at that point of time.

Thus the Target should also move accordingly.

Regarding stop loss yes you are correct!. You have to set your Stop loss every morning.

I take 5 day average of opening price of script to keep the appropriate stop loss.

After some thought over my last post and a look at the options available on Geojit's online site, I frankly don't know how to place a stop loss.

Let's say a stock has reached Rs. 100 by close of Monday.

I had bought it at Rs. 80 a few days ago and it's in my demat a/c.

I hope it will rise further but I don't want to lose all the Rs. 20.

I wouldn't mind risking a loss of Rs. 10 given that I hope the stock will rise further.

When and how can I place a stop-loss? If I merely place a sell order at Rs. 90 it will be snapped up in no time if the last traded price is above that!

So, once again, how does one put in place a "stop-loss"?

I have no idea about Geojit. I use ICICI

In you example

Ofcourse 90 could be snapped within no time, but then you have trade off, price might also goto 70 in no time? right?

Well you should look at Scripts volatility in past 5 days to arrive at safe stop loss target.

If I pick your example, I assume when you enter a trade you have your targets in mind! with decided stop loss

Assuming script average Volatility (Rise of fall) in last 5 days is 10 Rs

Day 1
Entry Price = 80
Stop loss Trigger Price = 70
SELL Limit price = 65
Target = 120

Day 2
Now that you are in profit
Current Price =100
Target = 120
Stop loss Trigger Price = 90
SELL Limit price = 85

Just reconfirming the Rounding Top Pattern view presented to Forum

Also note 50 EMA (yellow Line) closeness to 200 EMA (red line). Crossover is imminent!

man, does that mean we should short this stock? if yes, what should be the stop-loss and target in the near term?

If I were you I would not Short such stock as it is drifting very painfully slowly to target.

There are better scripts to Short or go Long!

If you were holding the stock in April then you shoud have sold and got rid off it!

I'm not holding this stock..i was just curious after reading your thoughts..

anyways, some suggestions on shorting any particular scripts at any particular targets? Also, could you suggest some time frame for these scripts to achieve those targets?

Perfect rounding pattern...

Rounding patterns go back to where they started from.

This one started from 60 and may go back to 60.

The stock has 200-day EMA and 50-day EMA at 123 and 126 respectively.

If someone wants to short, 119 may be a good level.

Stop-loss around 128 is a must. A failed rounding pattern may mean a runaway rally in the stock.

I wonder why such a pattern is getting created. Gujarat NRE Coke was supposed to be a fundamentally strong stock.

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It has announced the Dividend & Bonus. What does it means? Whether the Stock is going to rise or fall till the record date? I have heard that whenever a bonus is declared it generally falls & comes to nearly half of its price by the record date like the Reliance Power. Is it true?

Bonus is not of much importance.

Bonus only means the company is going to increase the number of shares.

Gujarat NRE Coke will be giving 2 for 5 bonus.

It means for every 5 shares held by an investor, he will get 2 additional shares.

Total market value of the company before and after a bonus remains the same.

===================================

If a bonus has been announced, but still hasn't been given, the shares are known as "cum-bonus".

After bonus has been given, the shares become "ex-bonus".

===================================

Therefore

cum-bonus price X cum-bonus number of shares

=

ex-bonus price X ex-bonus number of shares.

===================================

If ex-bonus number of shares is 1.4 times the cum-bonus number of shares,

then

ex-bonus price will be (1/1.4) times the cum-bonus price.

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So, it means that if the cum-bonus price of Guj NRE Coke is 100, then the ex-bonus price will be 71.43?

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If this is the case then why everybody run behind the bonus announced firm when u r not going to get any profit?

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Does it make any sense to buy such bonus announced stock, unless or until it is fundamentally very strong?

Yes, if the cum-bonus price is 100, then after the bonus, the price will fall to 71.43.

Only retail investors get excited about bonus announcements.

Buy a stock only if you think the stock has fundamental value.

It doesn't matter if the stock is cum-bonus or ex-bonus. You can ignore that.

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Thanks for your valuable explanation.

Just one more query:

Split also does the same thing, then what is the difference between Split & bonus?

Brgds

Pramod.

Bonus doesn't change the face value of the shares. Bonus is creation of new shares.

Split is division of existing shares.

Net effect of both is similar - increase in number and decrease in value of individual shares.

In my opinion, both bonuses and splits can and should be ignored by investors.

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This stock is clinging to the levels of 103-106 even in the relief rally, I hope it sticks to these levels even if the market moves the other way.


@alchemist

What is your view on this script in the near term?

If government decides to regulate the prices of raw materials to steel firms, just to contain the contribution from steel prices while calculating WPI, how bad will this news be to GNCL?

What will be the impact on this stock because of the recent news on Gujarat stocks to share 30% PBT for social causes...

I bought this stock @106 with a short term view/target of 125, and I'm seeing that this is falling in line with other gujarat stocks... Is it better to exit now?

The decision to share 30% seems ridiculous... Is 30% that much small or what....?

I think the 30% relates to companies in which the Gujarat state government is a major stake-holder.

I don't think Guj NRE Coke is in that category.

It's fall may be related to opposition to its mining activities in Australia. (They have environmentalists there too! )

This was from the Economic Times dated 22/08/2008 but the company has refuted the allegations on its web-site. Sorry for any inconvenience caused by my previous post.

Any views on this stock (GUJNRECOKE)?

The rounding-top school predicts Rs. 50-60.

Is the other reason the general decline in commodities and the fall in oil?

Another company(earlier sesagoa) to announce bonus and rights issue when we are heading for commodity decline!

http://profit.ndtv.com/2008/09/11102...d-2ab420c903e0

I think market wisdom is to look bonus and preferential issues from another angle, some trouble somewhere!

oops!! in that case I'm in big trouble.....
Hello everybody...I am coming back here after a long time and again I have started with a blunder...
I just purchased GUJ NRE @ 95....should I exit this??? or should I hold for some time......

Welcome back!

If you can adjust your losses in GNCoke against some other short term cap. gains, get rid of it.

Or you can read today's DNA Money for more info. and opinion.

Most happy moment has come for technical analysis!

GUJNRECOKE Close today 49!

Target achieved!

Are you accumulating at this price?

No! Rounding top is a major reversal pattern which is very bearish. This implies price will go further down!

I won't touch this stock!

This view stands until proven guilty!

Needs to give me a upside breakout, before I buy!

Overall

Commodity needs to still bottom out!

USCOAL Index has still not touch the floor!

BALTIC Dry index has fallen 75%! No shipping demand overall including COAL!