Capital Market With Front Pages

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INDEX

S.No

CHAPTER

NUMBER

CHAPTERNAME PAGE NO.

1 I INTRODUCTION 1

2 II COMPANY PROFILE 4

3 III

THEORETICAL

ASPECTS

28

4 IVDATA ANALYSIS AND

INTERPRETATION43

5 V

CONCLUSIONS

AND

FINDINGS

55

6 BIBLIOGRAPHY 61


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CHAPTER-I

INTRODUCTION


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INTRODUCTION

Indian Capital Market since liberalization has undergone tremendous changes and has

evolved as a vibrant system of investment flows. A dynamic capital market is an

important segment of the financial system of any country as it plays a significant role

in mobilizing savings and channeling them for productive purposes. The efficient

fund allocation depends on the stock market efficiency in pricing the different

securities traded in it.

The project has been divided into two parts- fundamental analysis and technical

analysis.

This has been done because it has often been said that an ideal trading system would

be to use both fundamental and technical analysis in tandem prior to making an

investment.

The first part of the project deals with fundamental analysis and certain key macro

economic variables that are important prior to making an investment. The first of

these ratios is the market capitalization to GDP ratio which indicates the overall

condition of the market. It is a ratio that is used to find out if the market isundervalued or overvalued. The second important ratio is the price to earnings ratio of

Sensex, which indicates how much the investor is willing to pay per rupee earning of

the company. The next part of fundamental analysis deals with Maslows hierarchy of

needs and its importance in making investment decisions. This part of the project

deals specifically with the Indian population and where they lie on the Maslows

hierarchy of needs level.

The second part of the project deals with technical analysis and its importance to

generate buy and sell signals at key points. A One year study of 15 scrips is done

using an important technical indicator i.e., Exponential Moving Averages through two

different strategies to generate delivery based calls. Similarly, a one year study is

done on Nifty 50 scrips to generate long and short calls for Delivery trading.


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Objectives of the study

1. To understand and analyze the functioning of the capital markets2. To understand the importance of macroeconomic variables and analyze its

effect on the Indian stock market

3. To relate Maslows hierarchy of needs and the economic situation of anemerging Indian market.

4. To study the trends in price movements of a stock using various tools ofTechnical analysis.

5. To forecast the future price movements using various technical indicators.6. To analyze intraday trading using candlestick charting.

Limitations of the study

1. Availability of data for all the asset classes was limited.2. The time frame used for technical analysis was limited and hence developing a

new trading system was difficult.

3. The data for the key ratios like the P/E ratio and the Market capitalization toGDP ratios were not easily available.

4. The technical indicators used by itself are not enough to generate the buy andsell signals. Several indicators have to be used in tandem to generate an ideal

trading system.

5. Candlesticks are not yet widely followed in the Indian scenario. The mostwidely used charting system is still the bar charts as they are tried and tested in

the Western countries.

6. Moving averages cannot be used as a standalone indicator as it is a laggingindicator, implying that the moving averages are formed only after the priceaction is generated.

7. Hence a trader may lose out on profits if he uses only moving averages to buyand sell.


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Research Methodology

Research in common parlance refers to a search for knowledge. One can also define

research as a scientific and systematic search for pertinent information on a specific

topic.

Research Design

Research Design is the conceptual structure within which research is conducted. It

constitutes the blueprint for collection, measurement and analysis of data. The design

used for carrying out this research is Exploratory.

Data type

In this research the type of data used is

Secondary data

Data source

The sources of collection of data are:

Websites

Books


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CHAPTER-II

COMPANY PROFILE


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INTRODUCTION TO THE INDIAN STOCK MARKET

The Indian broking industry is one of the oldest trading industries that have been

around even before the establishment of BSE in 1875

Inception- The roots of a stock market in India began in the 1860s during theAmerican Civil War that led to a sudden surge in the demand for cotton from

India resulting in setting up of a number of joint stock companies that issued

securities to raise finance.

Bubble burst- The early stock market saw a boom till 1865, and then in Jul1865, what was then used to be called the share mania ended with burst of the

stock market bubble. In the aftermath of the crash, banks, on whose building

steps share brokers used to gather to seek stock tips and share news,

disallowed them to gather there, thus forcing them to find a place of their own,

which later turned into the Dalal Street. A group of about 300 brokers formed

the stock exchange in Jul 1875, which led to the formation of a trust in 1887

known as the Native Share and Stock Brokers Association

Beginning of a new phase- A new phase in the Indian stock markets began inthe 1970s, with the introduction of Foreign Exchange Regulation Act (FERA)

that led to divestment of foreign equity by the multinational companies, which

created a surge in retail investing.

Growth supporting factors-The early 1980s witnessed another surge in stockmarkets when major companies such as Reliance accessed equity markets for

resource mobilization that evinced huge interest from retail investors. A new

set of economic and financial sector reforms that began in the early 1990s

gave further impetus to the growth of the stock markets in India.


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Setting up of SEBI- the Securities and Exchange Board of India (SEBI),which was set up in 1988 as an administrative arrangement, was given

statutory powers with the enactment of the SEBI Act, 1992. The broad

objectives of the SEBI include-

o to protect the interests of the investors in securitieso to promote the development of securities markets and to regulate the

securities markets

Incorporation of NSE- NSE was incorporated in Nov 1992 as a tax payingcompany, the first of such stock exchanges in India, since stock exchanges

earlier were trusts, being run on no-profit basis. NSE was recognized as a

stock exchange under the Securities Contracts (Regulations) Act 1956 in Apr

1993. It commenced operations in wholesale debt segment in Jun 1994 and

capital market segment (equities) in Nov 1994. The setting up of the National

Stock Exchange brought to Indian capital markets several innovations and

modern practices and procedures such as nationwide trading network,

electronic trading, greater transparency in price discovery and process driven

operations that had significant bearing on further growth of the stock markets

in India. To speed the securities settlement process, The Depositories Act

1996 was passed that allowed for dematerialization (and dematerialization)

of securities in depositories and the transfer of securities through

electronic book entry. The National Securities Depository Limited (NSDL) set

up by leading financial institutions, commenced operations in Oct 1996.

Despite passing through a number of changes in the post liberalization period,the industry has found its way towards sustainable growth. A stock Broker is a

regulated professional who buys and sells shares and other securities through

market makers or Agency Only Firms on behalf of investors. To work as a

broker a certificate of registration from SEBI is mandatory after satisfying all

the terms and conditions.


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FINANCIAL MARKETS

The financial markets have been classified as

Cash market (spot market)largest traded, the spot market or cash market is acommodities or securities market in which goods are sold for cash and

delivered immediately.

Derivatives market after cash market, the derivatives markets are thefinancial markets for derivatives. The market can be divided into two that for

exchange traded derivatives and that for over-the-counter derivatives.

Debt market - The bond market (also known as the debt, credit, or fixedincome market) is a financial market where participants buy and sell debt

securities.

Commodities market after commodities market, Commodity markets aremarkets where raw or primary products are exchanged. These raw

commodities are traded on regulated commodities exchanges, in which they

are bought and sold in standardized contracts.

NEED OF A BROKER

A broker is a person or firm that facilitates trades between customers. It is advisable

to conduct transactions through an intermediary. For example one needs to transact

through a trading member of a stock exchange if they intend to buy or sell any

security on stock exchanges. One needs to maintain an account with a depository if

they intend to hold securities in demat form. You need to deposit money with a

banker to an issue if you are subscribing to public issues. One gets guidance if you

are transacting through an intermediary. A broker acts as a go between and, in doing

so, does not assume any risk for the trade. The broker does, however, charge a

commission. A broking firm acts as an intermediary between NSE and Client. Stock

Brokers come under the category of Market Players. The membership in the stock

exchange can be granted as individual membership and corporate membership.

NSE BROKER CLIENT
http://en.wikipedia.org/wiki/Commodities_exchangehttp://en.wikipedia.org/wiki/Commodities_exchange


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The market intermediaries play an important role in the development of Securities

Market by providing different types of services. There are two major stock-exchanges

NSE (composition of 50 stocks) and BSE (Composition of 30 stocks).

Exchange-wise Stock Brokers Registered with SEBI (As on March 31, 2008)

Sn No.Stock

Exchange

Total No. of

Stock Brokers

No. of Corporate

Brokers

Corporate

Brokers As A %

of Total Stock

Brokers

1. Ahmedabad321 157 48.91

2. Bangalore256 124 48.44

3. Bombay946 767 81.08

4. Bhubaneswar214 19 8.88

5. Calcutta957 204 21.32

6. Cochin435 80 18.39

7. Coimbatore

135 48 35.56

8. Delhi374 213 56.95

9. Gauhati103 3 2.91

10. ISE

interconnecte

935 345 36.90


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11. Jaipur488 18 3.69

12. Ludhiana297 85 28.62

13. Madhya

Pradesh174 34 19.54

14. Madras181 71 39.23

15. NSE1,129 1,039 92.03

16. OTCEI 719 551 76.63

17. Pune188 55 29.26

18. UPSE354 78 22.03

19. Vadodara311 64 20.58


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AN INTRODUCTION TO EDELWEISS

Edelweiss capital was started by two IIM graduates Mr. Rashesh Shah and Mr.

Venkat Ramaswamy. The Company is operating in India as an Integrated Investment

Banking Company. Edelweiss strives to be a thinking organization, trying to be

innovative and imaginative. The policy of the company ensures transparency and

greater opportunities for all its clients.

SNAPSHOT

Approach

Client Focus, Execution orientation, Culture, Professional Integrity, Research Driven

Aim

Building long term relationships with the clients and equipping the clients about the

market knowledge so that they can address the day by day fast growing opportunities.

USP

The single minded focus on thought leadership and relentless pursuit of the new and

different is it in products, services or people, model of employee ownership.

Culture

Entrepreneurial and result driven emphasizing confidentiality and integrity

Operations

Stock broking, research services, distribution of financial products, depository

services, and proprietary trading, 47 per cent of its revenue is from treasury and

wholesale financing

Research (POD)

90 researchers, covers over 200 stocks across 19 sectors that accounts for about 70%

of the total market capitalization


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Offices

Operates from 56 offices in 21 Indian cities, employs over 1600 employees

Major clients

ESL focuses on the wholesale equity segment, providing broking services to

Institutional and corporate clients and high net worth individuals

Market Capitalization- Rs 5,500 crore (Rs 55 billion),

Equity Base- over Rs 2,000 crorer

Website- www.edelcap.com,

www.edelweiss.in

HIGHLIGHTS

EBL has a strong equity research team, which covers approximately 50 - 60companies within 6 industry categories, with a focus on large and medium cap

stocks.

The companys Equities Broking division has now expanded to include 215stocks in 19 sectors accounting for 70 percent of market capitalization

Alternate Asset Managements total asset value currently stands at $625million

Wholesale Financing division soared to Rs. 141 crore in FY08 from Rs. 7crore in the previous year

Edelweiss is amongst the largest institutional broking firm, enjoying a healthy5% plus market share in the institutional broking segment


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Edelweiss is also in the process of widening its product portfolio bypenetrating into product specific and sector specific niches, which will

broaden and strengthen its entire institutional business

Asset base of over INR 800 cr. In lending business

It is empanelled with over 40 leading FIIs, FIs, Mutual Funds, Banks andInsurance companies

Listing in various stock exchanges NSE: EDELWEISS, BSE: 532922,Bloomberg: EDEL.IN

Awarded as Best Merchant Banker by the Outlook Money NDTV ProfitAwards, 2008

Ranked among the top ten players in Annual Bloomberg and AnnualThomson- Reuters

Present Chairman and CEO- Mr. Raskesh Shah

Well respected Brand with strong position in relevant market segmentsSTRENGHTS OF THE COMPANY

Has an integrated business model, which specializes in providing a wide range offinancial products and services such as investment banking, institutional equities,

wealth management, and wholesale finance.

Is well positioned to leverage the growing financial sector in India and become asignificant market player, especially in areas like investment banking, institutional


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equities etc.

Has a strong research platform with research products, such as fundamental andalternative research, catering to institutions and HNWIs and retails. The

fundamental research covers ~190 companies which represent ~69% of the

market capitalization of all the companies listed on BSE as on August, 2008. On

the other hand alternative research utilizes quantitative techniques to identify

short term and medium term investment opportunities in the capital market

The company has a strong internal controls and risk management systememployed throughout the firm to access and monitor risk across various business

line. The Risk exposure is monitored and controlled through a variety of separate

but complementary financial, credit and operational reporting system

Is an established brand with strong track record of high growth and profitability?

Is strongly focused on nurturing & maintaining strong business relationships withcorporate & institutional clients

Well positioned to utilize the immense opportunities in the Indian financial sectorRECENT APPROACH

Edelweiss is a premium broking firm whose targets were only HNWI clients. But

seeing the opportunity in retail sector it has forayed into it. The company is providing

the same research facility to its retail clients as it provided to its premium clients. It is

offering an online platform to the clients which will increase transparency and make

business hassle free for the clients. The company is making a shift from ESL

(Edelweiss Securities limited) to EBL (Edelweiss Broking Limited).


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Thus the company is customer focused and protects the wealth of its customers

through its innovative ideas. The company is repositioning itself from a niche

marketer to a mass marketer and is aiming at Brand Repositioning.

THE PRODUCTS AND SERVICES OFFERED BY EDELWEISS

ARE AS FOLLOWS:-

Capital based

Agency based

SERVICES

Recent initiatives/high growth areas

Investment Banking:

This includes services such as M&A advisory, transaction execution relating to

structured finance, equity markets, real estate, and infrastructure.

Institutional Equities

Edelweiss Institutional equities business comprises institutional equity sales, sales-

trading, and research.

Private Client Brokerage

These services are targeted at high net worth and other individuals who actively

invest and trade in the equity market.

Wealth Management

Wealth management involves providing investment advisory, planning & asset

deployment services to high net-worth individuals.

Asset Management

This involves both asset management as well as investment advisory services. Under

this, the company advises three funds with an aggregate corpus of over USD 330 mn.


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Insurance Brokerage

Edelweiss has also entered the non-life insurance brokerage business as an IRDA

registered broker in 2005 and it distributes insurance products through its subsidiary,

Edelweiss Insurance Brokers Limited.

Treasury

The internal treasury operations manage the excess capital funds by investing the

same in low risk strategies to achieve risk-adjusted returns.

Wholesale financing

Wholesale business provides the high net worth individual and corporate clients with

facilities such as loans against shares, loans to finance IPO subscriptions, and loans

against mutual fund units. This is done through a subsidiary, ECL Finance Limited.

PRODUCTS

Advisory Based Broking (ABB)an asset management service. Margin Funding-

The Company provides funds to people who wish to invest large amount in

stock market but are lacking in fund. Fund is provided against securities. The

company has a policy of hair cut which means that the assets that are kept as

securities, they are valued less than their original price. Fund is provided for

investing in only those stocks that are listed in the stock brokers list of the

company. This is to save the company from loss as company has those stocks

in the list that are less volatile and whose market value is good.

Structured ProductAs such, structured products were created to meet specific needs that cannot

be met from the standardized financial instruments available in the markets.

Structured products can be used as an alternative to a direct investment, as

part of the asset allocation process to reduce risk exposure of a portfolio, or to
http://en.wikipedia.org/wiki/Portfolio_(finance)http://en.wikipedia.org/wiki/Portfolio_(finance)


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utilize the current market trend

Mutual Fund

This is a product offered by the company that takes money from the investorsand invests it in the stock market on their behalf as customers are not fully

aware of the stock market. They take money from many customers and

collectively invest in the stock market.

InsuranceAnother product offered by the company in which the agent gets commission

on every insurance policy done by him.

ArbitrageArbitrage, or true arbitrage, involves buying and selling a security and taking

advantage of prices differences that may exists on different markets.

While rare, this does happen from time to time Portfolio Management Services- this product comes under wealth

management.

Customers are advised where they should invest their total investmentsavings.

Initial Public Offering (IPO) - This product invites public to participate inthe bidding process.

Demat accountIt refers to Dematerialized Account. It is necessary to sell and buy stocks. So

it is just like a bank account where actual money is replaced by shares. One

has to approach the DPs, to open his demat account. So one doesnt have to

possess any physical certificates showing that you own these shares. They are

all held electronically in the account. As one buys and sells the shares, they

are adjusted in their account. Just like a bank passbook or statement, the DP


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provides with periodic statements of holdings and transactions.

Commodity market- In this market metals and agricultural products aretraded.

MCX for metal products and NCDEX for agricultural products.CLIENT REVENUE MIX

Institutional/corporate client individual clients

CLIENT REVENUE MIX

Institutional/corporate client individual clients

22%

78%

institutional clients corporate clients


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GROWTH STRATEGY

The Companys growth areas are basically across three categories- Products,

asset classes and client segments. It basically focuses on HNWI clients, and now it

has come into the retail segment which is its source of growth. From the asset side it

gets fixed income and is also into real estate. The popular products are wholesale

financing, financial product distribution etc.


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INTRODUCTION

Fundamental Analysis

Introduction to Fundamental Analysis

Fundamental analysis is a process of looking at a business at the basic or

fundamental financial level. The primary assumption of fundamental analysis is that

the all the factors are not discounted in the current market price. There is something

called the intrinsic value of the stock which is its true value. Fundamental analysis

also assumes that the market will reach its true intrinsic value in the long term and

hence the market value and the intrinsic value will reach equilibrium. Hence if the

market value at present is lower than its intrinsic value, then it is good time to invest

and vice versa.

The steps involved in fundamental analysis are:

1. Macroeconomic analysis, which involves considering currencies, commodities and

indices.

2. Industry sector analysis, which involves the analysis of companies that are a part of

the sector.

3. Situational analysis of a company.

4. Financial analysis of the company.

5. Valuation

Fundamental Analysis Tools

There are several tools used for fundamental analysis. Some of the most popular are:

1. Earnings per Share

2. Price to Earnings

3. Projected Earning Growth (PEG)


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4. Price to Sales (P/S)

5. Price to Book (P/B)

6. Dividend Payout ratio

7. Dividend yield

8. Book value

9. Return on Equity (ROE)

10. Ratio analysis

Stock Market Capitalization to GDP ratio

Market Capitalization - Market capitalization of a company is determined by

multiplying the price of its stock by the number of shares issued by the company.

Similarly, market capitalization of an index is calculated by adding the individual

market capitalization of the companies in the index. Free float market capitalization

method is used to calculate the market capitalization of SENSEX. Free float market

capitalization is defined as that proportion of total shares issued by the company that

are readily available for trading in the market. It excludes promoters holding,

government holding, etc.

Gross Domestic product - GDP is defined as the total market value of all final goods

and services produced within the country in a given period of time.

GDP = C + I + G + NX

CConsumption expenditure

IInvestment expenditure

GGovernment expenditure

NXNet exports = ExportsImports


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Stock Market Capitalization to GDP ratio - The stock market cap to GDP ratio is

used to measure whether a market is overvalued or undervalued. Usually a value of

over 100% indicates that the market is overvalued and best not to invest. A value of

below 100% is considered undervalued and hence the right time to invest. Warren

buffet said that if the ratio is around 80% it is a good time to invest and if it is more

than 200% then it is better to stay away from investing in that market.


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Calculation of the ratio - It is calculated as:

Quarterly Stock Market Capitalization to GDP ratios of India

Year Q1 Q2 Q3 Q4

YearQ1 Q2 Q3 Q4

Table 1.2: Quarterly Market Cap to GDP ratio


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Changes in Stock Market Capitalization to GDP ratio

Analysis of the ratio

The Stock Market capitalization to GDP ratio is used to determine whether an overall

market is undervalued or overvalued. The ratio can be used to focus on specific

markets, such as the Indian market, or it can be applied to the world market depending

on what values are used in the calculation.

For the first time in Indias history, the market capitalization of the BSE crossed th e

countrys domestic GDP. This statistic can be observed in the graph as well, where

the market capitalization to GDP ratio crossed 1 for the first time.

As the chart above suggests, for India, the average market cap to GDP number over

the past 2 decades has been 52%. Indian markets were trading near this ratio in March

2009 (when the downward rally started). And as we stand currently, the markets are

back at almost their 2008 peak.


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As per Buffett, a 70-80% range on this ratio indicates that markets are somewhere

between moderate valuation and fair valuation. If the ratio exceeds 115%, the markets

are in the overvalued zone where odds of investing are not in the favor of investor.

Price To Earnings Ratio of the SENSEX

P/E ratio - The price to earnings ratio is an important indicator used by several

fundamental analysts. The P/E of a company tells us how much the investor is willing

to pay, based on the earnings of the company. The P/E ratio also tells us how much

the market is willing to pay the investor per rupee earning of the company.

The P/E ratio is calculated as

P/E= Stock price/Earnings per share

The stock price is the current market value of the stock.

The EPS can be calculated in three ways. EPS is calculated as the net earnings divided

by the outstanding shares. If the EPS is calculated based on the net earnings of the

previous four quarters, it is called trailing P/E. If the EPS is calculated based on the

estimated earnings of the next four quarters, it is called a forward P/E. Sometimes theEPS is calculated using the net earnings of the previous two quarters and the next two

quarters. Hence there are types of P/E ratio.

Significance of the ratio - The P/E ratio cannot be the only indicator to base ones

investment. There are two ways to read the P/E ratio. One method is to compare the

P/E of the company to the industry P/E. If the P/E of the company is higher than the

P/E of the industry it means that the market is expecting some positive events from

the company as far as earnings are concerned. This can be interpreted in two ways. It

could mean that the company is outperforming the market and hence is overheated or

it could mean that there are some positive events associated with the company and

hence a good time to invest. The second method to read the P/E is to compare the P/E

of the company with its competitors in the same industry. This gives a general idea as

to whether the stock price is undervalued or overvalued.


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Quarterly P/E ratios of SENSEX

YEAR Q1 Q2 Q3

Q4 Sensex


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Movement of SENSEX

Changes in the P/E ratios

Analysis of the ratio

The P/E ratio of the BSE Sensex had been fluctuating till 1994-95. It has been

relatively stable from then on shifting between 15- 20 levels which is good P/E for a

growing economy.

The P/E of the Sensex as of June 2010 is 20.5. This when compared to the emerging

and developed market is quite high. Except the US Nasdaq, the P/E ratios of the major

indices are between 12 and 17.


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Analyzing India Using Maslows Hierarchy of Needs

Physiological needs- These are the basic needs that are required to sustain life. They

include food, water, air, etc. According to Maslows theory, if these fundamental

needs are not satisfied then one will surely be motivated to satisfy them. Higher needs

such as social needs and esteem needs are not recognized until one satisfies the needs

basic to existence.

Safety needs- Once basic needs are satisfied the attention turns to safety and security

needs of the individual. The various safety and security needs include housing

security, insurance, job security, financial security, etc.

Social needs- This, according to Maslows, is the first level of higher level needs.Social needs are those related to interaction with others and they include friendship,

belonging to a group, etc.

Esteem needs- Esteem needs can be internal esteem needs or external esteem needs.

The esteem needs include self-respect, achievement, attention, recognition and

reputation. The first two are internal esteem needs where as the last three are external

esteem needs.


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Self-actualization- Self-actualization is the summit of Maslows hierarchy of needs.

It is the quest of reaching ones full potential as a person. The needs associated with

self-actualization include truth, justice, wisdom, etc.


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CHAPTER-III

THEORETICAL

ASPECTS


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INTRODUCTION

Despite the economic reforms of 1991, Indias economic growth has been slow

compared to the levels achieved by the other Asian economies in the past. From 1991

when the economic reforms began till 2000 end, Indias GDP per capita has

grown at 4.2% a year. Up to the early 1980s, GDP per capita grew at only 1.6% a

year. From the mid 1980s to 1991, GDP per capita grew to around 2.6% a year.

Currently the growth rate hovers around 6% to 9%.

The growth patterns of the Indian economy are an indicator of not just the economic

scope in the country but societal pattern as well. The further study analyses specific

indicators of the Indian economy relative to the GDP growth, which may support thepositioning of the Indian people on Maslows Hierarchy of Needs. Through the

findings, it seems most probable that India has the majority of its population lying in

the Security and Social Needs of Maslows Hierarchy.

Subsequent passages show examples from the demographics of the country which

may support this position of the Indian population on the Hierarchy of Needs.

Background Facts

Population: 1.18 Billion

Demography (Age):

0-14 years31.1% 15-64 years63.6% 65 & above5.3%

Average age: 24.9 years

Poverty:

The following figures show the percentage of population below poverty line

200026% 200622%


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Literacy:

2001 - 65.38% 2007 - 64.8% 2009 - 61%

Infant Mortality rates:

200734.61 per 1000 babies 200832.31 per 1000 babies 200930.15 per 1000 babies

Life expectancy:

200663 years 200969.89 years

Findings

The demography pattern of India shows that the majority of the population lies in the

1564 years age bracket. This by itself can lead to an assumption that the majority of

the population fall in the Security and Social needs of Maslows Hierarchy. If we look

at the average age of the population we notice that India is by and large a young

nation, which further substantiates the finding.

The poverty figures have been declining over the years. From 26% in 2000, the

population below the poverty line by 2006 estimates dropped to 22%. The literacy

rates of India are unimpressive at a mere 61% and have decreased over the years,

which is not a promising sign. The decreasing mortality rates and increasing life

expectancy show that healthcare in India has been bettering over the years. As such,

even on the healthcare front Security needs of the Indian people even though

improving, need substantial improvement.


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Other examples corroborating the findings

The following specifics of India have been used to substantiate our findings:

Household Insurance Telecom

A majority of Indians have per capita space equivalent to or less than a 10 feet x 10

feet room for their living, sleeping, cooking, washing and toilet needs. The average is

103 sq ft per person in rural areas and 117 sq ft per person in urban areas. It may then

be inferred that most of the population are somehow satisfying the physiological need

of housing.

Though the number of companies providing insurance is being increasing but the

contrasting fact is only 1% of the population is insured for life. The insurance sector is

still highly untapped. On the telecommunications front, more than half of the

population own mobile phones. In absolute numbers this translates into 600 million

mobile users in the country. In comparison, land lines are only a meager 150 million.

Consequently we assume that with the shift of preference to mobile phones over theyears, the Indian people are addressing their social needs as well.

However, this does not indicate that the majority of the population may have

surpassed the social needs status on Maslows hierarchy.

Analysis

From the GDP growth it can be understood that India is an emerging growing

economy. The average age of the Indian population is 24.9 years and hence by and

large a relatively young population. Also a majority of the population fall under the

15-64 years age bracket which substantiates the finding that majority of the Indian

population lie in the Social and Security needs of Maslows hierarchy. What this

indicates is that the Indian government needs to address the security needs of the

Indian population through more reforms in the insurance sector, more impetus on

rural education and finally more investment in the rural household sector.


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The last of the three is substantiated by the fact that the poverty figures in India are

very disheartening and there is an urgent requirement from the government to spend

heavily on the rural household sector.

The poverty figures indicate that 22% of the population is struggling to address their

physiological needs. Only about 30% of the population is urbanized and hence this

further substantiates the findings that majority of the population falls in the security

needs of Maslows hierarchy. To further confirm the above findings it is important to

note that only 1% of the population is insured for life and 0.2% is covered under

mediclaim. With the increasing number of insurance companies, Indian population is

trying to fulfill their security needs.

I would also like to add that though most of the Indian people are carrying cell phones

with them, they cannot be placed on the social needs of Maslows hierarchy. The fact

that a large section of the population are still struggling to meet their security needs

cannot be ruled out. The research also led me to believe, albeit inconclusively, that

not more than 5% of the population of India has passed the social needs stage. Hence

it may easily be concluded that Indians lie on the Security needs stage of the

Maslows hierarchy.

Correlation between SENSEX and Nifty

SENSEX is the sensitive Index of Bombay Stock Exchange (BSE), India, a Market

Capitalization Weighted average of 30 large and financially stable companies BSE

stock prices. These 30 companies account for a half of the total market capitalization

of BSE. Started since 1986, SENSEX is monitored by most of the global markets as

well.

NIFTY is Standard & Poors CRISIL NSE Index 50, is the index for large and

financially sound companies whose stocks are being traded on National of National

Stock Exchange (NSE) of India. Started since November 1995, nifty is most widely

used for benchmarking index funds, index based derivatives and to evaluate the

overall performance of the nations stock market over time. On plotting the daily

closing values of Sensex and Nifty for about last three and a half years (2nd

Jan 2007

to 31st May 2010), with the hypothesis that SENSEX is independent variable and


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Nifty is dependent on SENSEX, by performing ANOVA or Analysis of variables test

in MS-Excel, the coefficient of correlation or R-square comes out to be 85% and the

hypothesis proves to be correct with 95% confidence. The inference from above

mathematical analysis is that even though both indices belong to separate markets,

their performance/daily movement is almost identical, which can be spotted visually

as well, because both the curves fit very well and mostly give identical information.

The war between the two has intensified due to the ever rising competition between

NSE and BSE. Both of them have their own USPs. The market Capitalization of NSE

is almost twice of BSE, but, the BSE is the oldest stock exchange in Asia and has its

own history. The fact that both are having many independent powers & separate

entities worsens the situation. So, the only common link between them now is SEBI,

which has a totally different role, as its a regulatory authority to watch and control

the legal and ethical aspects of the market and protect the interests of shareholders.

Hence, no one, not even the SEBI is an intermediary between the two, thereby,

intensifying the competition between them to become the preferred exchange for top

companies. Even though the competition is healthy for any company to emerge

stronger, provide more value added services and work smarter, it becomes totally

unhealthy and destructive when there are price wars and a red ocean causing them to

put their riches in advertising and other undue marketing/brand building expenses.


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So, whom to track? Whom to believe and follow? Which of them is a better indicator

of the market? Who is better in improving the Indian stocks? Ironically, it doesnt

matter at all. Both SENSEX and Nifty are well diversified and contains many similar

companies stocks. So, even though Nifty has got 20 more companies, thats 67%

more variety, both SENSEX and Nifty moves in the same direction and the trend

seems like totally correlated. There is a definite difference in scale or magnitude, but,

after scaling and equalizing both to similar bases, there will be hardly any difference

in both indices. So, the choice is based only on convenience and not on the

performance. The global markets prefer SENSEX because that was the only option

with them earlier and they dont want to switch to other without any clear reason for

that sudden change.

Technical Analysis

Introduction to Technical Analysis

Technical analysis is the study of market action, primarily through the use of charts,

for the purpose of forecasting future price trends. For technical analysts, the term

market action includes three sources of information. They are price, volume and open

interest. Open interest is used only in futures and options.

There are three premises on which technical analysis is based. They are

1) Market action discounts everything - Anything and everything that affects the

price is actually reflected in the price of that market. Hence a technical analyst will

only study the price action and not the reasons behind the change in the price.

2) Prices move in trends - There are three types of trends. They are uptrend,downtrend and sideways trend. The assumption of technical analysis is that a trend in

motion is more likely to continue than reverse or a trend in motion will continue in the

same direction until it reverses.

3) History repeats itself - The meaning of the phrase history repeats itself is that the

key to understanding the future lies in the study of the past, or that the future is just a

repetition of the past.


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Usually the following tools & instruments are used to do the technical analysis:

Price Fields

Technical analysis is based almost entirely on the analysis of price and volume. Thefields which define a security's price and volume are explained below.

Open - This is the price of the first trade for the period (e.g., the first trade of the

day). When analyzing daily data, the Open is especially important as it is the

consensus price after all interested parties were able to "sleep on it."

High - This is the highest price that the security traded during the period. It is the

point at which there were more sellers than buyers (i.e., there are always sellerswilling to sell at higher prices, but the High represents the highest price buyers were

willing to pay).

Low - This is the lowest price that the security traded during the period. It is the point

at which there were more buyers than sellers (i.e., there are always buyers willing to

buy at lower prices, but the Low represents the lowest price sellers were willing to

accept).

Close - This is the last price that the security traded during the period. Due to its

availability, the Close is the most often used price for analysis. The relationship

between the Open (the first price) and the Close (the last price) are considered

significant by most technicians. This relationship is emphasized in candlestick charts.

Volume - This is the number of shares (or contracts) that were traded during the

period. The relationship between prices and volume (e.g., increasing prices

accompanied with increasing volume) is important.

Open Interest - This is the total number of outstanding contracts (i.e., those that have

not been exercised, closed, or expired) of a future or option. Open interest is often

used as an indicator.

Bid - This is the price a market maker is willing to pay for a security (i.e., the price

you will receive if you sell).


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Ask - This is the price a market maker is willing to accept (i.e., the price you will pay

to buy the security).

Chart Styles

Price in a chart can be displayed in following styles:

1. Bar Chart.

2. Line Chart.

3. Candlestick Chart.

1) Bar Charts:

The highs and lows of a stock are plotted in a diagram and the points are joined with

vertical lines (bars). A small horizontal tick to the left denotes the opening level while

a small horizontal tick to the right represents the closing price of each interval.


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2) Line Chart

It gives the detailed information about every aspect. The stock prices for each time

period are plotted in a diagram and the points are joined. Prices on the y-axis and time

on the x-axis.

The line chart chooses for example the closing price of consecutive time periods, but

can also work with daily, official fixings.

3) Candlestick Chart

Although candlestick charts are nearly identical to typical Western bar charts, there is

one important distinction: candlestick charts are far more dramatic in their

presentation. Instead of the standard high-to-low vertical lines accompanied by

horizontal ticks that identify the day's open and close, candlestick charts employ two-

dimensional bodies to depict the open-to-close trading range and upper and lower

stems (or shadows) to mark the day's high and low. A candlestick is black if the

closing price is lower than the opening price. A candlestick is white if the closing

price is higher than the opening price.


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Candlestick Patterns

Bullish Patterns

1) Long white (empty) line. This is a bullish line. It occurs when

prices open near the low and close significantly higher near the

period's high

2) Hammer. This is a bullish line if it occurs after a significant

downtrend. If the line occurs after a significant up-trend, it is

called a Hanging Man. A Hammer is identified by a small real

body (i.e., a small range between the open and closing prices)

and a long lower shadow (i.e., the low is significantly lower than

the open, high, and close). The body can be empty or filled-in.

3) Piercing line. This is a bullish pattern and the opposite of a

dark cloud cover. The first line is a long black line and the

second line is a long white line. The second line opens lower

than the first line's low, but it closes more than halfway above the

first line's real body.


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4) Bullish engulfing lines. This pattern is strongly bullish if it

occurs after a significant downtrend (i.e., it acts as a reversal

pattern). It occurs when a small bearish (filled-in) line is

engulfed by a large bullish (empty) line.

5) Morning star. This is a bullish pattern signifying a potential

bottom. The "star" indicates a possible reversal and the bullish

(empty) line confirms this. The star can be empty or filled-in.

6) Bullish doji star. A "star" indicates a reversal and a doji

indicates indecision. Thus, this pattern usually indicates a

reversal following an indecisive period. You should wait for a

confirmation (e.g., as in the morning star, above) before trading a

doji star. The first line can be empty or filled in.


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Bearish Patterns

1) Long black (filled-in) line. This is a bearish line. It occurs

when prices open near the high and close significantly lower near

the period's low

2) Hanging Man. These lines are bearish if they occur after a

significant uptrend. If this pattern occurs after a significant

downtrend, it is called a Hammer. They are identified by small

real bodies (i.e., a small range between the open and closing

prices) and a long lower shadow (i.e., the low was significantly

lower than the open, high, and close). The bodies can be empty

or filled-in.

3) Dark cloud cover. This is a bearish pattern. The pattern is

more significant if the second line's body is below the center of

the previous line's body (as illustrated).

4) Bearish engulfing lines. This pattern is strongly bearish if it

occurs after a significant uptrend (i.e., it acts as a reversal

pattern). It occurs when a small bullish (empty) line is engulfed

by a large bearish (filled-in) line.


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5) Evening star. This is a bearish pattern signifying a potential

top. The "star" indicates a possible reversal and the bearish

(filled-in) line confirms this. The star can be empty or filled in.

5) Doji star. A star indicates a reversal and a doji indicates

indecision. Thus, this pattern usually indicates a reversal

following an indecisive period. You should wait for a

confirmation (e.g., as in the evening star illustration) before

trading a doji star.

6) Shooting star. This pattern suggests a minor reversal when it

appears after a rally. The star's body must appear near the low

price and the line should have a long upper shadow.

Reversal

Patterns

1) Long-legged doji. This line often signifies a turning point. It

occurs when the open and close are the same, and the range

between the high and low is relatively large.

2) Dragon-fly doji. This line also signifies a turning point. It

occur when the open and close are the same, and the low is

significantly lower than the open, high, and closing prices.


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3) Gravestone doji. This line also signifies a turning point. It

occurs when the open, close, and low are the same, and the high

is significantly higher than the open, low, and closing prices.

4) Star. Stars indicate reversals. A star is a line with a small real

body that occurs after a line with a much larger real body, where

the real bodies do not overlap. The shadows may overlap.

5) Doji star. A star indicates a reversal and a doji indicates

indecision. Thus, this pattern usually indicates a reversal

following an indecisive period. You should wait for a

confirmation (e.g., as in the evening star illustration) before

trading a doji star.


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Neutral Patterns

1) Spinning tops. These are neutral lines. They occur when the

distance between the high and low, and the distance between the

open and close, are relatively small.

2) Doji. This line implies indecision. The security opened and

closed at the same price. These lines can appear in several

different patterns. Double doji lines (two adjacent doji lines)

imply that a forceful move will follow a breakout from the

current indecision.

3) Harami ("pregnant" in English). This pattern indicates a

decrease in momentum. It occurs when a line with a small body

falls within the area of a larger body. In this example, a bullish

(empty) line with a long body is followed by a weak bearish

(filled in) line. This implies a decrease in the bullish momentum.

4) Harami cross. This pattern also indicates a decrease in

momentum. The pattern is similar to a harami, except the second

line is a doji (signifying indecision).


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CHAPTER-IV

DATA ANALYSIS

AND

INTERPRETATION


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Key Technical Indicators

There are several indicators that are used in technical analysis. But I have chosen to

highlight the following indicators as I have used some of these further in the project.

1. Moving average

2. Relative Strength Index (RSI)

3. Larry Williams % R

4. Moving average Convergence Divergence (MACD)

5. Fibonacci tools

1) Moving average - The moving average essentially a trend following indicator or a

lagging indicator as it is formed after the price movement occurs. Its purpose is to

identify or signal that a new trend has begun or that an old trend has ended or

reversed. Its purpose is to track the progress of the trend.


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There are three types of moving averages that are used by technical analysts. They are

a) Simple moving average - It is calculated by taking the average of the previous 10

or 15 closing prices. The weights given to each day is the same i.e. in a 10 day simple

moving average, the weight given for the 10th day closing price is the same as the

weight given for the 1st day closing price. The disadvantage of the simple moving

average is that it reacts slower to the price movement when compared to an

exponential moving average.

b) Linearly weighted moving average - In this type of moving average weights are

given in a linear proportion to each days closing price i.e. the 10th day closing price

is multiplied with 10, the 9th day with 9, and so on. The greater weight is given to the

most recent closing.

c) Exponential moving average - The exponential moving average assigns greater

weight to more recent data and it includes in its calculation all of the data in the life of

the instrument. The advantage of using exponential moving averages is that it reacts

quicker to the price movement than a simple moving average.

Analyzing moving averages - There are two ways to analyze moving averages. They

are as follows:

a) Single moving average and price - A single moving average is used to generate

buy and sell signals. When the price line moves above the moving average, a buy

signal is generated. Conversely, when the price line moves below the moving average,

a sell signal is generated.

b) Double crossover method - In this case two moving averages are used. One is a

shorter moving average and the other a longer moving average. When the shorter

moving average crosses above the longer moving average, a buy signal is generated.

Conversely, when the shorter moving average crosses below the longer moving

average, a sell signal is generated.


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2) Relative Strength Index (RSI) - Relative strength generally means a ratio line

comparing two different entities. A ratio of a stock or industry group to the Sensex is

one way of gauging relative strength of different stocks or industry groups against one

objective benchmark. Relative strength index solves the problem of erratic movement

and the need for constant upper and lower boundary.

The formula used for calculating RSI is

RSI=100-100/1+RS

RS=Average of x days up close/ Average of x days down close

Chart 2.6: Illustration of RSI

Analyzing Relative Strength Index - RSI is plotted on a vertical scale of 0 to 100.

Movements above 70 are considered overbought while an oversold condition would

be move under 30.

Because of shifting that takes place in bull and bear market, the 80 level usually

becomes overbought level in bull market and the 20 level the oversold level in bear

market.


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3) Larry Williams % R- Larry Williams % R measures the latest close in relation

to its price range over a given number of days. Todays close is subtracted from the

price high of the range for a given number of days and that difference is divided by

the total range for the same period.

In technical analysis this is a momentum indicator measuring overbought and

oversold levels. It is used to determine market entry and exit points.

Chart 2.7: Illustration ofWilliams % R

Analyzing Williams % R - The Williams % R produces values from 0 to -100. A

reading over 80 usually indicates a stock is oversold, while reading below 20 suggests

a stock is overbought.

4) Moving Average Convergence Divergence (MACD) - MACD is comprised of

two sets of line. One is called the faster line and the other the slower line. The faster

line is the difference between two exponential moving averages (usually 12 and 26). It

is also called the MACD line.


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The slower line is usually a 9 day exponential moving average of the MACD line. It is

also called the signal line. The buy and sell signals are based on the crossovers

between the two lines. Hence it is very similar to the double crossover method of

moving averages.

Chart 2.8: Illustration of MACD

Analyzing MACD - When the MACD line (faster line) crosses above the signal line

(slower line), a buy signal is generated. Conversely, when the MACD line crosses

below the signal line, a sell signal is generated.

Another way of interpretation using MACD is by comparing it with the zero line to

indicate overbought or oversold conditions. An overbought condition is when the

lines are well above the zero line and hence indicating a sell signal. An oversold

condition is when the lines are well below the zero line and hence indicating a buy

signal.

5) Fibonacci tools - Fibonacci tools utilize special ratios that naturally occur in nature

to help predict points of support or resistance. Fibonacci numbers are 1, 1, 2, 3, 5, 8,

13, 21, 34, 55, 89, etc. The sequence occurs by adding the previous two numbers (i.e.

1+1=2, 2+3=5) The main ratio used is .618, this is found by dividing one Fibonacci

number into the next in sequence Fibonacci number (55/89=0.618). The logic most


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often used by Fibonacci based traders is that since Fibonacci numbers occur in nature

and the stock, futures, and currency markets are creations of nature - humans.

Therefore, the Fibonacci sequence should apply to the financial markets.

Chart 2.9: Illustration of Fibonacci retracement

Fibonacci retracements - Arguably the most heavily used Fibonacci tool is the

Fibonacci Retracement. To calculate the Fibonacci Retracement levels, a significant

low to a significant high should be found. From there, prices should retrace the initial

difference (low to high or high to low) by a ratio of the Fibonacci sequence, generally

the 23.6%, 38.2%, 50%, 61.8%, or the 76.4% retracement.

Technical Analysis Software - The technical analysis software used is Metastock,

which is created by Equis International, a Thomson Reuters company. It is the most

widely used technical analysis software. The major competitors of Reuters are

Bloomberg and Dow Jones Newswires.

Trading Strategy


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As part of my technical analysis I worked on a technique for delivery based trading. I

have used 15 minute candlestick chart along with 2 exponential moving averages (8

EMA & 34 EMA) for my study. Candlestick chart is used as they are far more

dramatic in their presentation and it employ two-dimensional bodies to depict the

open-to-close trading range and upper and lower stems (or shadows) to mark the day's

high and low. The idea of using exponential moving average is that it assigns greater

weight to more recent data, and thereby reacts quicker to the price movement than a

simple moving average. I have specifically used 8 and 34 EMAs as they are Fibonacci

numbers and hold much importance in analyzing stock prices.

I have analyzed both the EMAs with double crossover method, i.e., when the 8 EMA

crosses above the 34 EMA, a buy signal is generated. Conversely, when the 8 EMA

crosses below the 34 EMA, a sell signal is generated. For my study I have considered

only buy signals as we can shortsell only in intraday trading.

For the buy signal, I have considered the closing price of the candlestick which is

forming just after the crossover. The position has to be kept until I get a signal to

close the position.

To close the position I have followed two different strategies. They are:

1. Closing the position with the first candlestick being formed below the lower

moving average.

2. Closing the position when a candlestick is formed whose closing is below the lower

moving average.


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Chart 3.1: Illustration of trading strategies

Process for the study

The purpose of this project was to find a successful trading system using candlesticks

and moving averages in tandem. Two exponential moving averages were used namely

8 EMA and 34 EMA with the help of which trading signal has to be generated over a

one year time period from May 2009 to June 2010. Two different strategies were used

as mentioned above and the study was done on 14 selected securities namely,

Balrampur Chini, DLF, ITC, Reliance Capital, Suzlon Energy, JP Associates, Sesa

Goa, Bhushan Steel, Infosys, Ansal Properties, ICICI Bank, HUL, L&T and ONGC.

Along with this the same study is also done on Nifty futures. The study was

conducted by plotting fifteen minute candlestick chart along with the two EMAs

simultaneously on Metastock.

Findings

The following table illustrates the accuracy and the returns for the study over a period

of one year:


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Analysis

In the first strategy, the returns were highest for Bhushan Steel at 100.23% followed

by Sesa Goa at 76.49% and DLF at 57.3%. On the other hand the lowest return was

given by Reliance Capital at 0.65% followed by ITC at 2.73% and ONGC at 4.98%.

Following charts illustrates the trend for Bhushan Steels and Reliance Capital:


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Chart 3.2: Illustration of Bhushan Steels

Chart 3.3: Illustration of Reliance Capital

In the second strategy, the returns were highest for DLF at 50.3% followed by JP

Associates at 32.29% and ICICI Bank at 31.94%. On the other hand the lowest return

was given by Ansal Properties at -4.25% followed by ITC at 4.13% and Sesa Goa at

9.39%.


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Following charts illustrates the trend for DLF and Ansal Properties:

Chart 3.4: Illustration of DLF

Chart 3.5: Illustration of Ansal Properties

Study of Nifty Futures for a period of May 2009 to June 2010

With the same strategies, a similar study was conducted on one of Indias premier

Index futures,

i.e., Nifty Futures. The following table shows the outcome of the study:


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With the first strategy, there was a benefit of about 400 points where as, with the

second strategy it was 173.8 points.

Chart 3.6: Illustration of Nifty Futures


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CHAPTER-V

CONCLUSIONS

&

FINDINGS


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CONCLUSIONS

Conclusion of the study of both the trading strategies

With the study of 14 different scrips and an Index future on both the trading

strategies, it was observed that the first strategy was comparatively better than the

second strategy.

For most of the scrips the returns were higher if trading is done with the first strategy.

The return for all the 14 scrips taken together comes to 430.94% and 254.44% taking

the first and the second strategies respectively. For Nifty futures also, the returns were

higher with the first trading strategy.

From the above study, it can be clearly concluded that the first strategy stands ahead

in comparison with the second.

Based on this conclusion, a further study is conducted for the futures contract of the

entire 50 scrips comprising Nifty.

Nifty Fifty Stock Futures analysis for a period of one year from May 2009 to

June 2010

After an in-depth study of both the trading strategies, it has already been concluded

that the first strategy stay ahead in comparison with the second one. Based on the

outcome of the previous study, another research is carried out with the futures

contract of the 50 scrips comprising the Nifty.

In this study, I have analyzed both the EMAs with double crossover method, i.e.,

when the 8 EMA crosses above the 34 EMA, a buy signal is generated. Conversely,

when the 8 EMA crosses below the 34 EMA, a sell signal is generated. As these are

future contracts, I am considering both the long and short calls for the purpose of

study, as this will enable the readers to understand the returns in both the calls.


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A study has been made which shows the relationship between different economic

variables and the market variables and the interrelationship between them. Thus it has

been observed that there is not a single factor that affects the movement in the stock

market but a number of variables like GDP, P/E, etc. influence a market to a great

extent. Any investor before making an investment should analyze the general

economic conditions prevailing in the economy and should make a suitable

framework for investment decisions. In the Maslows hierarchy we learnt that before

a company goes for overseas expansion it tries to study in which state of Maslows

hierarchy the desired country(India) is in. This makes the prediction of the various

variables accurate to some extent.

Along with the fundamental analysis mentioned above an educated investor would

always emphasize the importance of technical analysis as a tool to maximize profits

and minimize risk. It is a common view of experts that fundamental or technical

analysis by itself are strong indicators to use before investing, however, an educated

investor should always use technical and fundamental analysis in tandem before

making an investment. This would give the investor a holistic view and hence a more

informed view of the investment.


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FINDINGS

Following table shows the outcome of the above study. It contains the return and

accuracy for both long and short calls.


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Table 2.3: Outcome showing returns and accuracy for long and short calls

Analysis of the long calls

In the long calls, the returns were highest for Tata Motors at 98.75% followed by

Jindal Steel at 81.73% and Sterlite Industries at 75.59%%. On the other hand the

lowest return was given by Ambuja Cements at -9.02% followed by ACC at -4.24%

and Reliance Infra at 3.41%.


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Following charts illustrates the trend for Tata Motors and Ambuja Cements:

Chart 3.7: Illustration of Tata Motors

Chart 3.8: Illustration of Ambuja cements


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Analysis of the short calls

In the short calls, the returns were highest for Suzlon Energy at 100.54% followed by

Unitech at 83.46% and DLF at 59.17%. On the other hand the lowest return was given

by Cipla at -15.73% followed by Ambuja Cements at -10.91% and PNB at -8.57%.

Following charts illustrates the trend for Suzlon Energy and Cipla:

Chart 3.9: Illustration of Suzlon energy

Chart 3.10: Illustration of Cipla


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BIBLIOGRAPHY


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BIBLIOGRAPHY

Books

Technical analysis of the financial markets, Murphy, John J, pg 195-213, pg239 -255

Technical analysis from A to Z, Achelis, Steven Candlestick charting explained, Morris, Greg L, pg 19-141

Websites

http://www.hinduonnet.com/archives.htm http://www.abrahammaslow.com/m_motivation/Hierarchy_of_Needs.asp http://www.investopedia.com/terms/p/price-earningsratio.asp http://stockcharts.com/ http://www.candlecharts.com/ http://www.sebi.com/ http://www.moneycontrol.com/ http://www.nseindia.com/ http://www.bseindia.com/ http://dbie.rbi.org.in/ www.edelweiss.in
http://dbie.rbi.org.in/http://dbie.rbi.org.in/

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