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Friday, May 2, 2014

Stocks in the news this week (May 02, ‘14)

The last two phases of the extended general elections will take place over the next 10 days. Despite several polls predicting an NDA victory, stock market activity has slowed down as investors are not too sure of the election outcome. That hasn’t prevented a few stocks from going through the roof during the week. 

Quarterly results are being announced thick and fast. Most company announcements so far have been either along expected lines or below expectations. Their stocks have faced bear pressure. A few companies have provided positive surprises. Their stocks have received immediate buying attention.

Remember that news-based buying or selling doesn’t last long – unless the news is great or really bad. So, don’t get sucked into a bull or bear trap unwittingly. Do your due diligence.

Fulford

Fulford_May0214

This small-cap pharma subsidiary of a MNC made a loss last year and was trading in miniscule volumes when news of delisting through the book building method hit the market. Four straight days of upper circuit on massive volumes followed. All four technical indicators are looking extremely overbought. The stock has nearly doubled from its Mar ‘14 low of 619.95.

Tata Sponge

TataSponge_May0214

The stock of Tata Sponge entered three sets of rectangular consolidations, and broke out upwards from them on strong volumes. But this time it’s different. Though the latest break out coincided with announcement of good Q4 results, all four technical indicators are showing negative divergences by failing to touch new highs. The stock price has doubled from its Jan ‘14 low of 290.35.

TVS Motor

TVSMot_May0214

The stock price of TVS Motors had touched a 52 week high of 101.35 on Mar 24 ‘14, but formed a ‘reversal day’ pattern (higher high, lower close) and corrected down to a low of 84 a month later. The high-volume spike to a new 52 week high of 102.50 today was due to announcement of very good Q4 results. All four technical indicators are showing negative divergences by failing to touch new highs. The stock price has gained 265% from its Jul ‘13 low.

UPL

UPL_May0214 rev

The stock of UPL had formed a bullish cup-and-handle continuation pattern. The expected upward break out was accompanied by a huge volume surge as the company announced very good Q4 results. All four technical indicators are looking overbought. The stock price has more than doubled from its Aug ‘13 low of 121.

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