Since mid of August, I have started doing this as a study so the readers of this blog can learn along with me. I am also giving valuable list of stocks for quick profit. If anyone bought Kiriindus and Trent on the morning of 25th August as they showed up in 24th August list, they would have gotten a profit of 4-6% by evening.
I got inspired for this selection when I once noticed Indigo on daily chart and next day bought its CE at 9 and sold at 18 after few hours. Later traded TNPL, INFIBEAM, DIAMONDYD, JOCIL, BLISSGVS, ATULAUTO, during mid weeks of August and booked about 5% profit in a short time. Every stock may not rise the very next day. But I observed the potential for a rise in the next 10 days, on few stocks over a historical period of five years. Thus I decided to make such list everyday and trade familiar stocks or observe them for building trading watchlists to grow familiarity to trade later.
Today's short term selection list for short term study (2 weeks timeframe). Their performance will be reviewed after 7-Oct along with two weeks lists at one time.
Today's list got '2' stocks.
company symbol today's close price % rise today avg volume
CYBERTECH 65.7 12.1 195089
MAHINDCIE 139.3 5.6 349071
Same table as a picture.
In the secondary list we got 18 stocks.
company symbol today's close price % rise today avg volume
ADFFOODS 413.4 1.5 145607
AUSOMENT 42.9 3.1 17146
BIGBLOC 51.7 5 10410
BLUEDART 2788.2 4.1 70598
CDSL 479.6 9.5 2160459
CYBERTECH 65.7 12.1 195089
ELECTCAST 17.7 4.4 870587
GAEL 210.9 2.1 162639
GPPL 86.8 0.9 416315
GRANULES 363.2 3 5558008
HAVELLS 674.8 1.4 1988430
IBVENTURES 215.8 2.4 1940154
MAHINDCIE 139.3 5.6 349071
MMFL 319.1 1.6 35497
NIITLTD 137.3 2 1681651
SEQUENT 150.4 4.8 2103888
TANLA 259.8 3.2 771653
TIRUMALCHM 73.7 6.3 811138
Same table as a picture.
Commentary:
The difference between the two lists is that the first one finds stocks that are mostly rising after a long time. That is we see more stocks in it when money rotation is happening from large caps to mid caps and mid caps to small caps. The second list contains more stocks which have remnant effect. For example we see Granules and Tanla which had a good run-up recently. But as they have already runup, their volumes won't be as high as earlier when they initially show up in the first list, few months ago.
What can we do with two lists then?
Follow first list to get to know new stocks to which money is shifting. But that could be temporary too. If you were to consider these for long term watch list, very few will make it to that as most will fall down over time. Best time to find long term or medium term stocks from the first list is after a good downtrend is over. That is because this list is about finding stocks that have potential movement in the near future. But as bull market progresses, at some point we reach the peak. Then many junk stocks get money rotation benefit simply because they haven't rise for many months even while rest of the market had a good runup.
We should always be careful with the stocks that show up towards the end. It will have both good ones and bad ones too. Two things can help us from these stocks. One is the remnant effect that the stocks in this list show by giving atleast one second chance to get out. Another is our ability to detect change in sentiment in the market. First thing can be done with logic. Second thing requires intuition that comes with experience. If we don't read too much into news and small impact stuff, by process of elimination, and thinking of market movements of today, the day before, the week before, the month before and the up/down cycles that happened, we will gradually develop intuition. We will be able to feel the rhythm of the market. This helps us decide if we should hold the stocks for more upmove or get out with profit or zero loss or minimum loss, depending on extreme movements at that time.
The second list, helps to spot stocks that are familiar to us. Or those that are already in our watchlist. For example, you built your watchlist of stocks that you have followed for years or stocks that have good fundamentals and good expected future. If you are not investing in them long term, but want to capture sudden big movements in price that happens every few months, then you can spot them in the second list. These would show up in the first list too, after a market meltdowns. The growth stocks show up first after market crash because they are the ones investors will support first. After they rise a lot, they shift to other stocks that got ignored but are also good in fundamentals, though not as best as the first set of stocks. Money keeps shifting this way. After some time of consolidation in good stocks, they slow begin to move upwards to break previous high levels. Then also they show up in the secondary tables here.
I should have followed two tables from the beginning because I would not have missed Avantifeed's move recently. But I had traded Astrazen which made similar move in the same timeframe, but as I watched it closely, I traded it. This list would have helped notice Avantifeed too. Dixon too moved and I missed that too. By following coforge closely I got into it, after these three stocks' movement was reaching peak. Now coforge is doing good but dixon pulled back a lot. This happens. There is a phase shift between fundamentally good stocks too. The secondary list can helps us shift between them or notice their phase shift.
Noticing the phase shift between them is important for short term or medium term trading. Once you have seen a significant move in one stock, you need to prepare for the next. At that peak time, there will be stocks having had some weeks of consolidation and preparing for a rise. You could note few of them to enter at any time. But this list shows one or two of them first, and you can get into them. The others too would rise but if they don't make it to the secondary list, then they are only giving last chance for trapped traders to get out with minimum loss.
If all this sounds very confusing, don't worry. When we learn something new, we need to first anchor the new knowledge with existing knowledge. If it is too different from what we know, it is not easy to associate with existing knowledge and we get fed up with information overload. But as we go back, relax and ponder over it, then some structure develops in our mind to which we can anchor new knowledge better next time we read that. Just don't give up on learning.
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