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Capitalizing on Relative Weakness: Short ICICIBANK Long Nifty 50Introduction: In the dynamic world of trading, identifying relative strengths and weaknesses among stocks and indices is crucial for maximizing profits. This idea focuses on the underperformance of ICICIBANK compared to the Nifty 50 index. By analyzing the daily charts and employing a ratio chart, we can spot a potential opportunity for a pair trade. This write-up aims to provide an analysis of ICICIBANK's current trend, its ratio to Nifty 50, and how traders can profit from this relative weakness. Section 1: Understanding the Ratio Chart To gain further insights into ICICIBANK's relative performance, let's examine the ICICIBANK/Nifty 50 ratio chart. This ratio chart compares the price performance of ICICIBANK to that of the Nifty 50 index. By analyzing this chart, we can assess ICICIBANK's strength or weakness relative to the broader market. The ratio chart reveals a broadening wedge pattern breakdown. This breakdown suggests a bearish outlook for ICICIBANK, indicating a potential continuation of its underperformance against Nifty 50. Additionally, the ratio has been consistently trending within a downtrend channel, emphasizing ICICIBANK's persistent weakness compared to the broader market. Section 2: Pair Trade Strategy Based on the technical analysis of ICICIBANK and the ICICIBANK/Nifty 50 ratio, a pair trade strategy can be implemented to capitalize on ICICIBANK's relative weakness. The pair trade strategy involves simultaneously shorting ICICIBANK and going long on Nifty 50. By shorting ICICIBANK, traders can profit from its anticipated further decline, while being long on Nifty 50 allows them to participate in the potential upside of the broader market. It is crucial to effectively manage risk when implementing this pair trade strategy. Setting appropriate stop-loss levels based on ICICIBANK's volatility and the overall market conditions is essential. Additionally, continuous monitoring of the ICICIBANK/Nifty 50 ratio is necessary to assess any changes in relative performance and adjust positions accordingly. Conclusion: The current technical analysis of ICICIBANK, along with its ratio to Nifty 50, suggests a bearish outlook for the stock. Traders can consider implementing a pair trade strategy by shorting ICICIBANK and going long on Nifty 50, capitalizing on the relative weakness of ICICIBANK compared to the broader market. One has to closely track the above ratio chart for the stop and target level for the pair trade
NSE:ICICIBANKShort
by T_Harth
HEROMOTOCO- Relative Strength says BUY!Attached: HEROMOTOCO/ NIFTY 50 Weekly Chart as of 28th April 2023 The above Ratio Chart also called a Relative Strength Chart shows that the Stock HEROMOTOCO is set to Outperform the Index Nifty 50 and has given a Buy Signal on this Ratio Chart based on Elliot Wave Theory Wave 1/ A was a 5 wave Impulse Ratio retraced to 0.786 in Wave 2/ B as a 3 wave Corrective AND NOW, Wave 3/ C to the Upside is set to start/ has started already and this means the Stock is expected to Outperform the Market from here, making it a BUY as you always buy Outperformers because that is where the Strength is! Note: The Stock has Earnings on 4th May, Thursday
NSE:HEROMOTOCOLong
by T_Harth
HDFC Bank Investors, Beware! 🚨Attached: HDFCBANK/ NIFTY 50 Weekly Chart as of 28th April 2023 The Chart above shows Potential Underperformance lies ahead for HDFC Bank. Investors are better off Avoiding/ Exiting the Stock unless they want to Underperform the Broad Market from here onwards. No alpha is to be made by Holding on/ Buying the Stock at the Current Price This Ratio Chart points to: - Lower Highs - Breakdown Retest - ABC Corrective Wave completion at 1.618 - Downtrend on this Ratio Chart likely to resume
NSE:HDFCBANKShort
by T_Harth
GAIL- Relative Strength says BUY!Attached: GAIL/ NIFTY 50 Daily Chart as of 12th April 2023 As you can see in the Attached Chart, there are 3 Bullish Signals hinting that the Ratio Chart is likely to Rally Up: 1) Cup and Handle Pattern Breakout (see Green Neckline)..... whose Target is still Pending as the Chart works its way up 2) Falling Wedge Breakout (see Wedge Blue lines)........ this is clear with today's Candle 3) Price (Ratio in this case) Moving Up within the confines of a Channel (see Black Channel) The Upside Target is shown by the Green Arrow Mark Extending Being a Relative Strength (Ratio Chart) the Signal we get from this says that GAIL is likely to Outperform Nifty 50 in the coming days/ few weeks
NSE:GAILLong
by T_Harth
NIFTY Possibilities Compared With India VIXEven though the chart is self explanatory, I have tried to compare NSE:NIFTY with NSE:INDIAVIX Blue line is NSE:INDIAVIX Brown line is NSE:NIFTY Dashed red line is trendline support and NF breaking above that Light yellow line is support line for NSE:INDIAVIX 2 possibilities exist - 1) India Vix continues to trade below or near the support line, and we may see some price stability for NF. Before embarking on the next journey, we may inch higher or consolidate around these levels. 2) The India Vix rises again, and the price begins to fall from its current levels. Another thing I noticed unfolding on both indices charts is this - 1) NF & BNF on DTF are almost at the upper end of Bollinger Band 2) Trading above 20/50 EMA 3) Both indices have a rising window candlestick gap on DTF ( July 6th and July 7th ) - a) It is a bullish continuation candlestick pattern b) A Rising Window candlestick pattern is a 2 candlestick pattern 1) There must be an empty space between the two candlesticks in the pattern where the prices do not overlap 2) Pattern is characterised by a price gap appearing between the first candle's high and the second candle's low c) It is possible for the first of the two candlestick patterns to have a red coloured real body, however the most likely scenario is two green coloured candlesticks that make up the pattern ( this has been established with the candles formed on both indices on July 6th and July 7th ) For July 8th, from my limited knowledge, 2 possibilities exist - 1) We fill the gap on the downside and close below the high of July 6th candle. This would nullify the pattern and price may head down again as bears have taken the control during this upmove 2) We go down and close just above the high of July 6th candle without completely filling the gap. If this happens, bullish momentum for the time being should continue Let's see which way the story unfolds. Happy Trading! Disclaimer - - The view expressed here are my personal views. I am publishing this for my own records and what I see on charts. - If you're referring to this, please consider this ONLY FOR educational & research purposes. - Past performance is not a guarantee for future predictions - Any decision you take, you need to take responsibility for the same. DO NOT consider this as an investment suggestion. - It's your hard earned money. Treat it wisely - Trade / Invest keeping in mind your trading style, goals and objectives, time horizon & risk tolerance - Do your own analysis and consult your financial advisor before investing. TIA!
NSE:INDIAVIX
by nerdywasabi
Nifty PSU Bank to Pvt Bank Ratio Chart BreakoutNifty PSU Bank Index is outperforming Private Bank Index by a big margin. Current Situation is Similar to 2004-2008 Period where maximum money was made by Public Sector Banks. Public Sector Banks where NPA's have bottomed out and Banks with High Provision Coverage Ratio has potential to surprise everyone on the positive side. Chart Suggests that PSU Banks can Outperform the Private Banks by Hefty 30-35% in Next 1-2 years. Meaning- If Private Banks Fall by 1.35%, Strong PSU Bank Index will fall just by 1% and on the upside if private bank index rises by 1%, Public Sector Banks will rise 1.35%.
NSE:CNXPSUBANK
by StrategicAlpha
NIFTYIT/NIFTY at the Top of RectangleNIFTYIT/NIFTY ratio chart has been trading in a range for the last 9 months since Sep'20, as shown in the rectangle pattern. The chart is breaching the top trend line of the pattern with momentum. RSI, the momentum indicator, never reached oversold conditions at the two times the ratio touched the bottom of the rectangle, indicating strength. The RSI is also well above 50 and in bullish zone. Based on this ratio chart, we can expect NIFTY IT to outshine the NIFTY index in the coming weeks if a breakout happens successfully. We will be monitoring the price action and keep this segment updated as and when we see a successful breakout or a fake out/breakdown.
NSE:CNXIT
by vipulmehta817