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1 INTRODUCTION The who think who know the market doesnt know the market the market really, who think he doesnt know the market knows the market really -Paul Tudor, Technical Analyst. Though it regarded as the tussle between buying pressure and selling pressure. The Ultimate game and soul of technical analysis lies in not only understanding the supply and demand but also understanding naked truth as mentioned above. The stock market history runs about 300 years and is aggressive in the last 100 years. In the beginning technical analysis was considered as a pseudo-science. Now technical analysis is the main branch in market analysis, which is regarded as an art and science. Interpreting chart patterns are considered as an art i.e.it is the eyes of the beholder to justify the formation of the pattern. The re-emergence of technical analysis as a variable and efficient approach to individual stock selection and market analysis has drawn a great deal of interest from practitioners and academicians. Technical analysis uses past prices to predict future prices and has been popular among investor and financial analysts despites criticism from some quarters .All stock broking firms and major daily newspapers analyses and publish technical commentary on the performance of the market as a whole and selected stock on a daily basis. The key premise of technical analysis is that markets are dominated by the competing emotions of fear and greed. These emotions are manifested in distinct chart patterns the fingerprints of human psychology. Moreover, these patterns tend to repeat again and again because human

nature is immutable. Technical analysis uses this phenomenon to predict the future direction of stock prices. Technical analysis provides the only mechanism to measure the irrational (emotional) component in all market. Technical analysis is derived from pragmatic theories of the founding fathers, which include Charles Dow and R.N.Elliot. They proposed the Dow Theory and the Elliot wave theory. The emergency of equity market provides greater opportunities for local and global investors. This project studies the applications of technical analysis in stock market

Importance of technical analyses: The very definition of analysis states that it is the process of identifying trend and trend and reversal at early stage. Thus, the foremost use of technical analysis would be to make an early in the market, when it is likely to rise and an early exit from the market, when the market is likely to reverse direction and move downward. This aspect can be referred to as timing ones entry new about the bottom and make an exit near about the top in every market cycle. The study reveals the movement of shares that is upward or downward, under different time periods. One may note that, as indicated buying and selling near about bottom and the top respectively and not the exact bottom and top. The reason for this is that buying or selling at the exact bottom / top can be only a random or fluke occurrence. It is just not possible to buy and sell consistently at the bottom and top. Now, this timing can be useful to both short-term and long term investor. The short-term trader can find out the short-term trend and ride that trend. The long-term trader can trade the long term trade. Further, with the help of technical analysis, is possible to identify periods where in one can expect a quick fall in a short span of time. This single advantage can be of great help in accelerating the return on investments. At times it is possible to arrive at the probable price and time target so that one can have a frame work within which one can trade or invest in the market. Also, it is possible to identify securities that will rise or fall faster than the market or other securities. Following the technical is important, even if the participants do not fully believe their use. This is because, at times, the technical are the major reason for a market move. Since they are a market moving factor, they should be watched.

1.2 INDUSTRY PROFILE

SECURITIES INDUSTRY: The most for reaching structural change centers on the securities industry following the big bang I in 1986. This represents an instructive case of the pressure inducing structural change. Historically, this sector has been highly regulated through practices. Enforced by the London stock exchange (LSE). Since 1908, stock exchange practices was based upon a strict signal capacity rule, which meant that member Firms were either brokers or jobbers in securities. But could not be both. Prior to the the stock exchange considered of 4852 individual members in 209 members in firm. Most of the firms (192) were brokers acting as agents for investors. Rationall y members firms. Member firm had been had to be partnerships. But changes to the rule in 1969 allowed members firms to become limited companies and to take outside shareholders; through a limit of 10% was place on shareholders in a member firm by single non member. This was raised to 29.9% in 1989, but the fact that member firm could not the owned by a single nonmember meant that firms could not be part of wider groupings. Thus the historic distinction and separation between banking and securities trading was in the UK financial system the project of self-imposed arrangements. No change in the laws was required to end this major feature of the British financial system The rule book of the LSE was never applied to the very much larger Eurobond mark et in the London were trading arrangements have always been different in four major respects banks were not excluded as trade and market makers, there was no single capacity operation, no fixed minimum commission charges were enforced, and trading has alwa ys been screen biased rather than one the floor of an exchange in fact it was the set of rules and restrictive practice enforced by the LSE that induce the Euro bond market to develop outside the ambit of the stock exchange

Evolution of stock exchange of India The origin of the stock market relates back to the year 1494, when the Amsterdam stock exchange was set up. In Indian it dates back to the 18 th century and year when the east India company was a dominant institution In India. The Bombay stock exchange (BSE) was founded in year 1875. The Ahmadabad shares and stock association were formed by about 150 brokers on 15 th June 1908. In the year 1920. One stock exchange was established in northern India and one madras called the madras stock exchange . The Hyderabad stock exchange LTD. was incorporated in the year 1944. Two stock exchange s which came into in Delhi by the name the Delhi stock share exchange association lid in the year 1947. The national stock exchange of India LTD. was incorporated in November 1947. The national stock exchange of India LTD. Was Incorporated in 1992. Today there are 23 stock exchanges in Indian including the 3 stock exchanges in Mumbai Bombay stock exchange (BSE). National stocks exchange (NSE) and over the counter exchange of India (OTCEI). National stock exchange (NSE) The national stock exchange of India limited has genesis in the report of the high

powered study group on established of new stock exchanges, which recommended promotion of the a national stock exchange by financial institution (FIs) to provide access to investors from all across the country on an equal footing. Based on the recommendations, NSE was promoted by leading financial institutions at the behest of the government of India and was incorporated in November 1992 as a tax paying company unlike other stock exchanges in the country. On its recognition as a stock exchange under the securities contracts (Regulation) act, 1956 in April 1993, NSE commenced operations in the wholesale debt market (WDM) segment in June 1994. The capital market (Equities) segment commenced operations in November 1994 and operations derivatives segments commenced in June 2000.

The logo of the NSE symbolizes a single nationwide securities trading facility ensuring equal and fair access to investors, trading members and issuers all over the country. The initial of the exchange viz., N, S and have been etched on logo and are distinctly visible. Mission of NSE NSEs mission is setting the agenda for change in the securities markets in India. The NSE was set up with the main objectives of establishing a nation wide trading facility for equities, debt instruments and hybrids, ensuring equal access to investors all the country through an appropriate communication network, providing a fair, efficient and transparent securities market to investors using electronic trading system , and meeting the current international standards of securities markets. Bombay stock exchange Bombay stock exchange limited (the exchange) is the oldest stock exchange in Asia with a rich heritage. Popularly known as BSE, was established as The native share &stock brokers association in 1875. It is the first stock exchange in the countr y to obtain permanent recognition in 1956 from the government of India under the securities contracts (regulation) Act, 1956. The exchanges pivotal and pre -eminent rule in the development of the Indian capital market is widely recognition and its index, SENSEX, is tracked worldwide. Earlier an association of person(AOP), the exchange is now a demutualised and the BSE (corporatization and demutualization) scheme,2005 notified by the securities and exchange Board of India (SEBI) Bombay stock exchange limited received its certificate of incorporation on August,2005. The Due Date for taking over the business and operations of the BSE, By the exchange was fixed for 19 th August , 2005, under the scheme .the exchange has succeeded the business and operations of BSE ongoing concern its recognition as an changed has been contained by SEBI

In terms of organization structure, the board formulates larger policy issues and exercises over-all control. The committees constituted by the board are broad based. The management team of professional. During the year designed to 2005, the trading volumes on the exchange showed robust growth.

Bombay stock exchange limited is Asias oldest stock exchange. It carries with itself the depth of knowledge of capital markets acquired since its inception in 1875. Located in Mumbai, the financial capital of India, it has been backbone of the countrys capital markets.

1.3 COMPANY PROFILE

INDIABULLS SEURIRTIES LIMITED Indiabulls Financial Services Limited was incorporated on January 10, 2000 as M/s Orbits InfoTech Private Limited at New Delhi under the Companies Act, 1956 with Registration No. 55 - 103183. The name of Company was changed to M/s. Indiabulls Financial Services Private Limited on March 16, 2001 due to change in the main objects of the Company from InfoTech business to Investment & Financial Services business. It became a Public Limited Company on February 27, 2004 and the name of Company was changed to M/s. Indiabulls Financial Services Limited. The Company was promoted by three engineers from IIT Delhi, and has attracted more than Rs.700 million as investments from venture capital, private equity and institutional investors such as LNM India Internet Ventures LTD., Transatlantic Corporation LTD., Farallon Capital Partners, L.P., R Capital Partners L.P., and Infinity Technology Trustee Pvt. LTD. and has developed significant relationships with large commercial banks such as Citibank, HDFC Bank, Union Bank, ICICI Bank, ABN Amor Bank, Standard Chartered Bank, Lord Krishna Bank and
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IL&FS. The Company and its subsidiaries have facilities from the above mentioned banks and financial institutions aggregating to Rs. 1760 million. The Company headquarters are co-located in Mumbai and Delhi, allowing it to access the two most important regions for Indian financial markets, the Western region including Mumbai, rest of Maharashtra and Gujarat; and the Northern region, including the National Capital Territory of Delhi, nearby cities, parts of Haryana, Uttar Pradesh and Punjab; and access the highly skilled and educated workforce in these cities. The Marketing and Sales efforts are headquartered out of Mumbai, with a regional headquarter in Delhi; and its back office, risk management, internal finances etc. are headquartered out of Delhi, allowing The Company to scale these processes efficiently for the nationwide network, Indiabulls Financial Services LTD fixes an issue price of Rs 19 per share for its initial public offering (IPO), which was oversubscribed 18.5 times. Indiabulls Financial Services IPO closed on September 10, with an impressive response from all categories of investors. The book was finally subscribed 18.5 times with over 1.3 lakh bids. The institutional portion was subscribed more than 12 times, the retail portion 25 times and the non-institutional portion 24 times. 2005-Indiabulls Financial Services LTD has informed that the Company has incorporated a wholly owned subsidiary Indiabulls Investment Pvt LTD ("IIPL") with a paid up share capital of Rs 5 lacks. 2011 -India bulls Financial Services is one of India's leading non-banking finance companies providing Home Loans, Commercial Vehicle Loans and Secured SME Loans. The company has a net worth of Rs 4,661 core with an asset book of Rs 20,788 Core. The company has disbursed loans over Rs 50,000 Core to over 3,00,000 customers till date. Amongst its financial services and banking peers, Indiabulls Financial Services ranks amongst the top few companies both in terms of net worth and capital adequacy. Indiabulls Financial Services has been assigned `AA+' rating and has presence in over 87 cities and towns with a total branch network of 170 branches. Indiabulls group of companies 1. Indiabulls Financial service 2. Indiabulls Real Estate 3. Indiabulls Power

1.4 PRODUCT PROFILE DEPOSITORY SERVICES: Enjoy the dual benefits of trading and depository services under one roof and experience efficient, risk-free and prompt depository service. Indiabulls is a depository participant with the National Securities Depository Limited and Central Depository Services (India) Limited for trading and settlement of dematerialized shares. Indiabulls performs Dearing services for all securities transitions through accounts. In JRG, investors can open DEMAT account for holding securities, mutual funds and commodities. Indiabulls offer depository services to create a seamless transactions platform execute trades through the India bulls depository Services. Indiabulls Depository Services is part of our value added services for our clients that create multiple interfaces with the client and provide for solutions that takes care of all your needs. They also offer various tariff plans to suite each and every category to investors via, Traders. Investors, HNIs, Corporate, NRIs, etc. Indiabulls: Automated pay -in facility Access information Anytime, Anywhere Quarterly Demat statements with valuation Statement on demand View and Demat A/C statement online Competitive transaction charges

Exclusive benefits for investors or customers: Reduced paper work Speedy settlement process resulting in increased liquidity of your securities No risk of loss, wrong transfer, mutilation or theft of shares certificates

Hassle free automated pay in of your sell obligation with no need for physical instruction Instant disbursement of non-cash benefits like Bonus and Rights Efficient pledge mechanism Wide branch & Franchisee coverage Personalized services of trained Help desk No charges for extra Transaction statement and Holding statement

1. EQUITY: Trading in equities with Indiabulls brings you as to when, where and how to invest. They have some key focus areas which we work on incessantly on order to bring you superior trading experience. These focus areas-based on our objectives of customer centricity include the following. Best in-class technology: Investing in cutting-edge technology Powerful research & Analytics: Experienced and trustworthy experts Transparency and standards Compliance : Call & Trade: Call on a local number & trade on the telephone Customers Service: Most dynamic and motivated team on the ground Reach & Delivery Model: Both Offline/Online and upgrading service delivery channels They has on of the largest retail network on South India, with its presence in over 500 customer touch-points through our Branch & Franchisee Network in more than & towns. This means, you can walk into any of these branches and connect to our highly skilled and dedicated relationship managers to get the best services. 2. COMMODITY: GOLD BULLION

Gold in a chemical with the symbol Au and an atomic number of 79. It has been a highly sought-after precious metal for coinage, jewelry, and other arts since the beginning of records
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history. The metal occurs as nuggets or grains in rocks. In veins and in alluvial deposits. Gold is dense, soft, shiny and the most malleable and ductile pure metal known. Pure gold has a Bright yellow color and luster traditionally considered attractive, which it maintains without oxidizing in air or water. Gold is one of the coinage metals and has served as a symbol of wealth and a store of value throughout history. Gold standards have provides a basis for monetary policies. It also has been linked to a variety of symbolisms and ideologies. India is the worlds largest consumer of gold, as Indians buy about 25% of the worlds gold purchasing approximately 800 tons of gold ever year. India is also the largest importer of the yellow metal; in 2008, India imported around 400 tons of gold. Whereas, Since the 1880s, South Africa, in 2007 China (with 276 tones) overtook South Africa as the worlds largest gold produce the first time since 1905 that South Africa has not been the largest. GLOBAL EXCHANGE: OTC markets at London (LBMA), New York and Zurich. Gold derivative exchanges at New York CME (COMEX), Tokyo ( TOCOM), and Mumbai (MCX) Crude oil (Energy)

Petroleum, also called crude oil, is a thick and black liquid. It consists mainly of hydrocarbons and is mainly found In the Middle East, North America, and Russia. It is the most important world energy source. It supplies 38% of the worlds energy at present Petroleum can be separated into fewer complexes but more useful mixtures by fractional distillation. The process is called oil refining. Petroleum can be easily transported by pipeline. Treated petroleum can be used as fuels; mainly gasoline (petrol) for cars, Diesel fuel for Diesel engines used in trucks, trains and ships, kerosene fuel for jets and as lubricants

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2.1 REVIEW OF LITERATURE

According to Achilles "Technical analysis is the process of analyzing a securitys historical prices in an effort to determine probable future prices." According to Edwards, Magee and Bassett "It refers to the study of the action of the market itself as opposed to the study of the goods in which the market deals. Technical Analysis is the science of recording, usually in graphic form, the actual history of trading (price changes, volume of transactions, etc.) in a certain stock or in the Averages and then deducing from that pictured history the probable future trend. According to Murphy "Technical analysis is the study of market action, primarily through the use of charts, for the purpose of forecasting future price trends. The term market action includes the three principal sources of information available to the technician price, volume, and open interest." According to Printing "The art of technical analysis, for it is an art, is to identify a trend reversal at a relatively early stage and ride on that trend until the weight of the evidence shows or proves that the trend has reversed. Therefore, technical analysis is based on the assumption that people will continue to make the same mistakes they have made in the past." This paper examines the impact volume and variance on the profitability of the Combined Signal Approach (CSA) to technical analysis. The volume and variance tests are conducted on the S&P 500 and NASDAQ from January 1990 to March 2008 (n=4,558).The results suggest that the profitability of the CSA is enhanced when employing either volume or variance into the trading model. Jointly employing volume and variance was notable to provide a significant improvement in profits over the employment of volume or variance alone; this is partially the result of the correlation between volume and variance.

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2.2 OPERATIONAL CONCEPT

TECHNICAL ANALYSIS: There are two main approach used in analysis the movement of share price the fundamental analysis and the technical analysis approach. Both the approaches have the same objectives of buying at a lower price and selling at a higher price to get good returns on investment. Thus the end goal in both the cases is the same. However there is a vast difference between the material studies and the basis of analysis to reach this goal.

Definition : The analysis is the study of the market or price actions, primarily through the use of charts, For the purpose of forecasting future price trends. Technical analysis can also be defined as the process of the indentifying trend and trend reversal at an early stage and to ride the trend until the weight of evidence suggests that the trend has reversed direction. Thus, the first task of the analysis is to ascertain the change in the direction of the trend and then the next task is to monitor the trend on a continuous basis so that one can ride or trade alone the new direction till the analysis leads one to conclude that the trend has reversed direction. To study the trend or direction of price movements, the technical analyst studies the historic price and volume data with the help of chart. Thus, the two basis prices information needed by the analyst are the price data and the volume data.

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DATA AND GRAPH: Technical analysis studies the price and volume data with the help of chart to ascertain the trend or direction of movement. The security can does change hands at different price level on the same day. The price at which it is traded is determined by the demand and supply relationship at that point of time. The price represents the consideration that the buyer is willing to pay to acquire an asset and the consideration that the seller willing to accept to part with the companys assets. Of the various price at which the deals are struck, four are important the high, low, open and close. This price represents the highest price lower price, opening price and closing price at which the deals were negotiated or the rate at which the security changed hands. Most of the indicators and tools used in technical analysis are based on these prices. TYPES OF CHATRS: There are three types of charts generally used in technical analysis. 1. The line chart or closing price chart 2. The bar chart or high-low-close chart 3. The Japanese candle stick chart. (1) CLOSING PRICE CHART (line chart): In the closing price posted by the security on a day to-day basis are plotted on the X and Y chart. Suppose one day one, the security close at rupees 20. Here, one has to move up to rupees 20 on the Y-axis and then move horizontally to day one on the X -axis and mark the point on the chart. In other words, if one has to draw two imaginary line one from rupees 20 on the Y-axis (that moves horizontally over to right of the chart paper); the point of intersection of the line would be given the first point on the chart. In the same manner, the points representing the closing price of the same subsequent days are plotted on the chart. Finally, drawing a straight line connects all these points.

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Chart on Line Chart:

(2) BAR CHARTS: The bar chart the high - low close chart is the most popular chart used by technical analyst. In this chart, the high, low and closing price of the day are plotted on a day to day basis in the form of a bar chart. The top of the bar would represent the high of the day, the bottom of the bar would represent the low of the day and a small horizontal hash on the right of the bar would represent the close of the day. At this juncture it needs to be mentioned that there are analyst who plot the opening prices as hash on the left hand side of the bar however, symbol plotted for the opening price on the bar chart is not quite common and majority of traders, who consider the opening price as important, prefer to use the Japanese candle stick chart instead of the bar chart.

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Chart on bar chart:

Bar chart (daily) of NIFTY for the month of march-2013

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(3)JAPANESE CANDLE STICK CHART: The Japanese candlestick chart represents the open, high, low and closing prices on a day-to-day basis. Each candle stick has a two parts, the shadow of the candle and the body of the candle. The shadow of the candle and the body of the candle. The shadow of the candle further divided in to the upper shadow and the lower shadow. The upper and lower shadow is separated from one another by body of the candle. The top of the upper shadow would represent the highest price posted by the security on a particular time interval(daily, weekly, monthly etc ) and the bottom of the lower shadow would represent the lowest price posted by the security during a particular time interval (daily, weekly, monthly etc ). The body of the candle would represent the open and close price.

White candle (closing price Above opening price)

black candle (closing price are than opening prices)

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Chart on Candle Stick:

DOW THEORY: Charles Dow commonly referred to as the grand daddy of the technical analysis formulated the Dow Theory. He also formulated the Dow Jones index way back in 1884. Even today the theory finds application in the stock market. In fact, this is one theory that has stood the test of time rather remarkable. Charles Dows contribution to modern day technical analysis cannot be understood. His focus on the basics of security price movement gives rise to a completely new method of analysis the market. The Dow Theory comprise of six assumptions: 1. The advantages discount everything. 2. The market is comprised of three trends: Primary trend Secondary trend, and Minor trend.
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3. Primary trends have three phases. 4. The average must confirm other. 5. The volume the Dow Theory focuses primarily on price action. 6. A trend reminds intact until it gives a definite reversal signals.

The Elliot wave theory: Ralph nelson Elliot (1871-1948) had been an accounted by profession. He retired in 1927 after contracting a serious illness and spent the next several years at is home in California. it was during his long period of convalescence that he developed his theory of stock market behavior. He apparently was mush influenced by the Dow theory. which has a lot in common with his wave principle. Elliot and Dow both refer to the tide cycles of the sea and compared the rhythm of the waves of the price fluctuation in the stop market. Two a Natures law-the secret of the universe. Elliot was convinced that his theory was a part of much larger law governing all of humans activity.

Interpretation: There are three basic aspects of theory wave pattern, ratio and time (in the order of importance). Elliot claims that the stock market follows a repetitive rhythm of a five wave advance followed by a three wave decline, in a complete Elliot wave cycle; wave two and four are corrective waves. After a five wave advance has been completed; a three wave corrections begins, subdivide in A-B-C structure. After that, a new five wave advance can start. In the given figure you can see the Elliot wave counts, there is the important consideration of degree. Elliot categories nine different degrees of trend ranking from a grand super cycle spanning two hundred years two a sub minuets degree covering only a few hours. Since computers record every price change of a specific markets, the described five wave sequence, can even be detected in intra-day moves lasting less than one hour.

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Trend concept: In technical analysis literature we would have come across the word trend quite trend often. When explaining the definition of technical analysis a reference was made on trend and trend reversal Trend is nothing but the direction of movement. Logically, the share price can either rise or fall move narrowly (flat). Thus, there are three direction in which the price can move. These three directions give rise to the three type of trend. When price are moving upward, The is said to be rising. When price are moving downward, it is called falling trend. And when price are moving in a narrow range, the trend can be said to said to be choppy or this trend itself has three directions.

TREND CONCEPT

RISING

FALLING

FLAT

Price does not rise or fall in a straight line. the rise or fall is generally interpreter by counter move. This counter move is known as a reaction. If the security is rising, the counter moves would be against the rise. If the security is falling, the counter move would be against the fall. Because of these counter moves, the security can be moving in a zigzag fashion, which gives rise to tops and bottom. Thus, a top is nothing but a price level from where the security reverses the down move and stars to rise. It is the position of the bottoms and the tops that determines the trend at any given point of time.

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Thus, in a rising trend one would find price movement carrying the security upward. In this rise, the security will exhibit the formation of higher bottom and higher tops. In a falling trend the movement would carry the price down and hence the security would exhibit the formation of a lower tops and bottoms. In a sideways market or flat market, the movement would carry the price sideways and the security would neither exhibit the formation of clear- cut higher bottom and higher tops nor the formation of clear-cut lower tops lower bottoms. At any given in time the trader or the investor has three options, to buy, to sell or stay away from the market. If the trend is rising, he would do well to buy. If the trend is falling, he should be selling, and if the trend is flat, it is the best to move away from the market. This is because in a flat trend, the security would neither be rising nor falling nor falling, and hence the trader or investor would lose out on the interest or the opportunity cost of funds .

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Chart patterns: Identify chart patterns is simply a form of technical analysis. Hundreds of years of price charts have show that price trend to move in trend. Well a trends is merely an indicator of an imbalance of the supply and demand. These changes can usually be seen by market action through changes in price. This price changes often from meaningful chart patterns that can act as a signals in a trying to determine possible future trend developments.

Head and shoulder:

The head and shoulder pattern is generally regarded as a reversal pattern and it is most often seen in up trends. It is also most reliable when found in an uptrend as well. Eventually, markets begin to slow down and force of supply and demand is generally considered in balance. Seller comes in at the high (left shoulder) and the down side probed (beginning neckline). Buyers soon return to the market and ultimate push through to new highs (head). However the new highs are quickly turned back and the down side is tested again (continuing neckline).tentative buying re-emerges and the market rallies once more, but fails to take out the previous high. (This last top is considered the right shoulder). Buying dries up and head and the market test the down side yet again. (Volume has a greater important in the head and shoulders pattern in comparison to other pattern. Volume generally follows the price higher on the left shoulder) However, the head is formed on diminished volume indicating the buyers arent as aggressive as they once were. And on the last rallying attempt the left shoulders volume is even lighter than on head, signaling that the buyers may have exhausted themselves). New selling comes in and previous buyer gets out. The pattern is complete when the market breaks the neckline. (Volume should increase on the breakout).

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The head and shoulder pattern can sometimes be inverted head and shoulders are typically seen in down trends. The inverted left shoulder should be accomplished by an increase in volume. The rally from the head lower, should show greater volume that the rally from left should

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3.1 OBJECTIVES OF THE STUDY

Primary objectives The objectives of technical analysis are to determine the right time to enter or exit from the market. It is not a question of what to buy but when to buy / sell. It is believed that the market movement is 90% psychological and 10% logical in nature.

Secondary objectives To study the behavior of the price of the stock To find out the over brought and over sold conditions of the scrip. To predict the extent and direction of the price movements To compare the stock price movement with the index movement and determining the trend To studies the application of technical analysis in stock market. To buy at lower price and sell at higher price of share price to get a good return on investment.

3.2 NEED OF THE STUDY Technical analysis is a key factor that is taken into consideration for finding the alternative approach to stock selection. This study has helped us in finding the position of ranking on the basis of return to be as Infosys, Tcs and Hcl in the ranking order. Even though there can be universal principals and rules that can be applied, it must be remembered that only technical analysis more an art than a science. As a form of art it is subject to more of interpretation. The need of the study reviews the moment of share that is upward or downward under different time periods. This study may be needful to both short term and long term investors. This study helps us to predict the future fall or rise of the share market.

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3.3 SCOPE OF THE STUDY

The capital gain of an investor depends on the performance of a particular companys stock in the market. The strong in the companys share is, the more the profit the investor gets. So it is necessary to ascertain, analyze and interpret the shares of various firms in order to know it position in the market. Investors can make vise investment with the help of this analysis. Relative sensitive index and moving average are tools used for the analysis. These tools help us to analyze when to buy, hold or sell the shares. That means at which price we must buy or sell the securities. It also helps as to analyze till when we must hold the securities. This study is much useful for both the clients and the share broking firms. Technical analysis helps the share holders to choose the best securities to invest to make profit. It also guides them to when to sell or how much time to hold the security and the like. Ti is also helps the share brokers. The share brokers can use these tools to give a good guidance to its clients regarding the transaction of shares. Since the customers get added service, they will retain to the company. It can be used as a method to increase their clients and their by profit. This study reveals how the share brokers and its clients are helped by technical tools. This project is intended to increase or to offer customer service with the help of simple financial tools. The companies can implant the tools and analysis mentioned in this project for the above purpose. If the company implements this projects, they will have increase in profit.

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4.1 RESEARCH METHODOLOGY

RESEARCH DESIGN Research design is the blueprint for fulfilling research objectives and answering questions. Research design is define as the specification of methods and procedures employed for acquiring the information needed. It is a plan or framework for doing the study and collecting the data. Types of research design: 1. Exploratory research design. 2. Experimental research design. 3. Descriptive research design. Out of the research design above said the research design undertaken for the purpose of the study was Descriptive research design. Descriptive Research: This study is based on the descriptive research design. Descriptive study is a fact finding investigation with Interpretation. The main objective of descriptive study is to describe the state of affairs as it exists at present. The descriptive research is concerned with specific predictions with narrations of facts and characteristics concerning individual. Hence, the researcher chooses to apply Descriptive design for the current study. Descriptive Design Generally describes the characteristics of a particular individual.

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4.2 METHOD OF DATA COLLECTION

Data Collection: There are two ways to collect data 1. Primary data. 2. Secondary data

Primary Data Primary data are those which are collected afresh and for the first time. It can be obtained through observation or through direct communication. Primary data were collected through Questionnaire.

Secondary Data Secondary data are those data which results the study done by others and for different purposes than the one for which the data are being reviewed.

4.3 STATISTICAL TOOLS USED

The analysis of data is carried out for secondary data by the following method.. Exponential Moving Average. Moving average convergence and divergence Relative Strength Index. Rate of change

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4.4 LIMITATIONS OF THE STUDY

Volatility of stock is crucial effective technical analysis The duration Of study was limited Since the share market has unpredictable risk, there actual result may change from the forecasted. The market price of share may change in higher rate than we calculated. So there is a Non occurrence of the findings will be there If the market is not stable the findings may mislead us wrong conclusions. The sample size is restricted to 3 months, which reduces accuracy of the result. Since the stock brokers have lot of other task to perform, they may not choose these tools. It will consume their time and extra personnel are to be appointed for the service Uncertainty is relevant I predicting the value of the shares. Only five securities are taken for the analysis. There may be many other securities that can give us more capital gains.

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5.1 TOOLS FOR ANALYSIS A) Exponential Moving Average: a) Moving averages: Moving averages are one of the most popular technical indicators used to identify the directions of stock market. The market does not rise or fall in a straight line. The up-moves and down-moves are interrupted by counter moves. Quite often, these counter moves are quite volatile making it difficult for the analyst to gauge the underlying trend of the market. Mathematically moving averages filter out the random noise in market data by smoothing out fluctuation and short-term volatility in price movement. Graphically super imposing a moving average on a price chart makes it easy to visualize the underlying trend within the data. Moving averages are precisely calculated according to specific mathematical formulae. This makes moving averages an objective way to determine the current trend direction of a market, and anticipate its most likely future directions. This is in sharp contrast to subjective approaches to trend identification based on visual chart analysis of reoccurring pattern such as head-andshoulders formation, flags, and pennants etc. In calculating the various types of moving averages, one must first the prices on which the moving average would be based. There are four basic types of prices maintained by the analyst, the open, high, low, closing prices. Of these, the closing prices are generally used to calculate the various types of moving averages. This does not mean that one cannot calculate the moving averages on either the high, low or the averages of these prices or for that matter any other combination of these prices. There are three types of moving averages that are commonly used by the analyst, simple, weighted, and Exponential Moving Averages. b) Exponential Moving Average: An exponential moving average improves the weighted moving average by weighting past history less and less, without ever removing the data completely so it eliminates the impact when a data point is dropped from the moving average. It still appropriately gives the highest
28

weighting to most recent data. However, this moving average is harder to understand than the simple moving average.. For calculating the exponential moving average the following formula is used (Current closing price-previous exponential Average) x Factor Exponential Average = __________________________________________________ Previous exponential average Where factor = 2/n+1. Here n=number of days for which the average is to be calculated.

Calculation of five day Exponential Moving Average Date Closing price Exponential Average 02-Jan-2013 03-Jan-2013 04-Jan-2013 05-Jan-2013 06-Jan-2013 07-Jan-2013 2,808.95 2,864.30 2,854.40 2,840.15 2,832.15 2,835.20

Take the closing price of the first day as the average for that day. The actual five day exponential moving average can be had from the sixth day onwards and so on. Here factor =2/n+1 Where, n=5 Factor=2/5+1=0.33

29

Average on 02/01/12 will be, Average = (66.70-64.65)*0.33/64.65=0.010 For starting the calculation, on the first day one does not have the exponential average for the first day. Hence in place of the exponential average of the first day, one can use the closing price on the first day as the exponential average on day one and proceeds with the calculations. If one is calculating exponential average for five days, the correct five day exponential average will be available from the sixth day on wards and so on. Another method of calculating the exponential moving average of five days to take the simple moving average of five days as the starting point or the exponential average on the fifth day and then calculating the exponential average for the sixth day with the help of the formula for exponential moving average.

Average period: A moving average represents the underlying trend in the security. For calculating the moving average the number of days to averages s the most important criterion. This number of days is also known as the average. The period of the average determines the period of the trend that is being identified. In other words, a five day period will represent the longer term trend (of 200 days) in security. Interpretation: The interpretation of moving average is quiet simple. The moving average line is superimposed on the price line and both the lines are studied together to locate buy and sell signals in the price chart. The analyst also study the relationship between two or more moving averages i.e. the relationship between long-term and short term moving averages. Some of the important indicators from using moving averages lines are:o Bullish signal-when the price line is above the moving average line.
30

o Bearish signal-when the price line is below the moving average line. o Buy signal-when the price line moves above the moving average line. o Sell signal-when the price line crosses below the moving average line.

B). Moving Averages Convergence Divergence (MACD)

MACD is one of the most accepted and widely used oscillators. MACD, as the name itself suggests the difference between two moves average. It is constructed by taking the difference between two moving average of different length and plotting that difference. For calculating MACD, we generally use Exponential Moving Average (EMA) to get faster signal from the chart. An EMA gives more weight to recent prices and decreasing weight to older data. It is the most sophisticated moving average which answers the criticism fixed by the simple moving average. To constructor the MACD, two EMA s are used, the short-term EMA and the long-term EMA the MACD is the difference between the short term EMA and long term EMA. Interpretation: The simple moving average line which is superimposed on the MACD line gives us the buy and sell signal. o Buy signal-if the MACD line moves above the simple moving average line. o Sell signal-if the MACD line moves below the simple moving average line.

C). Relative strength index (RSI): Relative strength index (RSI) is a momentum indicator; it measures the market momentum (if constructed for the indices) or security momentum (if constructed for individual security). RSI is developed by wells wilder. It is an indicator used to identify the inherent technical strength or weakness in particular security. This indicator should not be confused with
31

RSC indicator. The RSC or the Relative strength comparative is the ratio of two prices of different securities. RSI will show from one extreme to the other across a central reference point or the equilibrium point. RSI is used along with the price chart and never in isolation. This is because the RSI would indicate the possibility of trend reversal or the likelihood of the security rising of falling at a fast price. The RSI is calculated for the particular security by using the following formula. RSI=100-(100/1+RS) Where: RS=Average gain per day/Average loss per day.

Calculation of 9-days RSI:

Date 02-Jan-2013 03-Jan-2013 04-Jan-2013 05-Jan-2013 06-Jan-2013 07-Jan-2013 09-Jan-2013 10-Jan-2013 11-Jan-2013

Closing price 2,808.95 2,864.30 2,854.40 2,840.15 2,832.15 2,835.20 2,836.55 2,863.60 2,826.60

Gain 0 55.35 0 0 0 3.05 1.35 27.05 0

Loss 0 0 9.9 14.25 8 0 0 0 37

G = total gain L = total loss RS = G/L RSI = 100 - (100/(1+RS)) G= 86.8/9 =9.64 L= 69.15/9 = 7.68 RS =9.64 /7.68 = 1.25 RSI = 100-(100/(1+1.25)) = 55.55 The average gain or loss per day is, in turn, arrived at by adding up the gain or losses, per day, calculated by comparing the closing price on a day with that of the proceeding day, (gain

32

and losses have to be added separately and not merged) and then dividing the total of gains or losses by the period for which RSI is calculated. The RSI can be calculated for any number of days depending on the strategy of the technical analyst and the time frame of trading. The most commonly used time period is the 14days RSI. However, some analyst uses 5-days RSI, 7-days RSI or even 9-days RSI for quick

trading. In general, it can be stated that the greater the period, the lower would be the Volume of whipsaw (incorrect signals). RSI can be calculated on daily basis or weekly or monthly basis. For calculating the daily RSI, the weekly closing price is used, for monthly RSI, one has to use the monthly closing price. Interpretation: Whenever the RSI goes above seventy, one had better prepared for a down turn. Similarly, when RSI goes below thirty, it is time to pick the security. These, of course Are board rules yet there could always be exceptions. What adds to this forecasting merit is the fact that the RSI generally moves above the seventy ranges or below the thirty ranges much before the security makes the top or the bottom i.e. it gives an early warning of the top or bottom that would be in the making. Once this top or bottom is formed, one can expect a significant reaction in the security or the very trend may changes.

4. Rate of Chan (ROC) Rate of change measures the rate at which prices rises or fall. The concept of ROC can be explained with the help of a simple example. A ball thrown up into the air shoots up with speed but subsequently slows down considerably before it turns to come down again. The loss of upward momentum that occurs before the ball change course can be seen in the currency market also. Before peaking out, currency prices register a notable decrease in momentum. To measure the ROC, the ratio of the most recent closing price to the price for certain number of days in the past in worked out.

33

To calculate a 13-day ROC, the latest closing price is divided by the closing price before 13 days. If the latest price is higher than that of the historical price to the 13 previous days, the ROC value will be above the line 1 and vice-versa. Interpretation: If the ROC line is above 1, the current day price is higher than that of 13 days ago. If the ROC is above 1 and rising, the difference between the current day price and 1days back grows at an increasing rate, then it gives a bullish signal. Similarly, if the ROC line is above 1, but declining the price rises at a lower rate than the earlier growth rate, then it gives a bearish signal. If the ROC line is below 1, the current days price is lower than the price 13 days ago. If the ROC line is below 1 and falling, the current price and the 13 days back price grows at a faster rate, then it gives a bearish signal. Similarly, if the ROC line below 1, but rising, the rate of decline slows down, it gives a Bullish signal.

34

OPINION REGARDING THE SELLING OR BUYING OF SCRIPS OF INFOSYS TECHNOLOGIES LTD DURING JAN APR 2013

Date 02-Jan-2013 03-Jan-2013 04-Jan-2013 05-Jan-2013 06-Jan-2013 07-Jan-2013 09-Jan-2013 10-Jan-2013 11-Jan-2013 12-Jan-2013 13-Jan-2013 16-Jan-2013 17-Jan-2013 18-Jan-2013 19-Jan-2013 20-Jan-2013 23-Jan-2013 24-Jan-2013 25-Jan-2013 27-Jan-2013 30-Jan-2013 31-Jan-2013 01-Feb-2013 02-Feb-2013 03-Feb-2013 06-Feb-2013 07-Feb-2013 08-Feb-2013 09-Feb-2013 10-Feb-2013 13-Feb-2013 14-Feb-2013 15-Feb-2013 16-Feb-2013 17-Feb-2013 21-Feb-2013 22-Feb-2013 23-Feb-2013

Open 2,759.20 2,824.10 2,845.00 2,839.20 2,838.00 2,838.90 2,847.50 2,870.00 2,868.00 2,750.00 2,618.00 2,581.25 2,650.00 2,644.00 2,616.00 2,596.00 2,590.00 2,618.00 2,635.00 2,702.00 2,698.90 2,712.00 2,739.70 2,740.10 2,740.05 2,805.10 2,805.00 2,748.00 2,749.00 2,799.00 2,775.25 2,776.00 2,815.00 2,864.00 2,916.25 2,930.00 2,905.20 2,939.00

High 2,816.65 2,886.95 2,875.00 2,876.00 2,867.60 2,851.50 2,866.30 2,875.40 2,894.90 2,750.00 2,619.00 2,644.00 2,672.80 2,644.00 2,622.80 2,609.70 2,615.50 2,639.60 2,675.00 2,735.00 2,725.20 2,754.65 2,748.00 2,783.00 2,792.00 2,807.90 2,805.00 2,782.00 2,822.10 2,802.00 2,800.50 2,809.90 2,875.00 2,917.70 2,978.00 2,959.90 2,994.00 2,982.60

Low 2,742.00 2,820.00 2,841.05 2,831.45 2,811.10 2,828.05 2,817.20 2,850.20 2,813.00 2,578.05 2,552.25 2,579.10 2,633.85 2,585.00 2,576.60 2,576.30 2,589.00 2,595.00 2,625.00 2,686.20 2,690.00 2,706.00 2,695.65 2,730.00 2,740.05 2,752.10 2,713.65 2,741.35 2,731.85 2,751.15 2,757.10 2,764.00 2,815.00 2,860.55 2,900.15 2,911.25 2,905.20 2,916.20

LTP 2808.00 2865.20 2845.00 2840.00 2829.10 2834.95 2827.80 2864.15 2819.00 2590.25 2582.00 2640.00 2648.75 2607.00 2590.00 2580.00 2602.00 2613.00 2668.90 2721.00 2699.00 2740.00 2746.00 2752.95 2778.10 2760.00 2731.35 2765.95 2806.20 2775.05 2780.00 2809.00 2858.40 2912.85 2958.90 2926.00 2945.15 2929.10
35

Close 2,808.95 2,864.30 2,854.40 2,840.15 2,832.15 2,835.20 2,836.55 2,863.60 2,826.60 2,588.25 2,584.20 2,640.15 2,662.05 2,612.05 2,594.70 2,588.80 2,600.30 2,620.80 2,665.80 2,725.00 2,712.30 2,746.00 2,742.70 2,757.00 2,783.25 2,777.10 2,727.50 2,769.15 2,809.90 2,790.40 2,788.40 2,801.05 2,864.10 2,908.95 2,947.80 2,938.25 2,952.25 2,933.15

Volume 7,28,272 11,12,876 9,17,678 8,90,659 8,85,954 95,521 10,33,223 13,97,397 17,24,475 61,21,325 26,12,368 16,48,592 10,92,553 12,12,553 12,06,542 14,54,464 6,45,108 7,06,651 13,18,170 15,27,359 11,98,557 10,82,362 7,83,667 14,42,282 14,54,650 9,92,210 9,02,705 8,33,937 12,69,605 6,47,202 7,16,751 6,84,721 8,97,291 10,32,069 14,32,160 7,56,153 13,01,640 13,09,370

Turnover 20,258.04 31,860.66 26,206.27 25,418.18 25,119.10 2,711.87 29,354.63 39,985.09 49,097.36 1,60,837.1 67,416.47 43,300.87 29,050.17 31,633.44 31,289.54 37,677.72 16,799.28 18,504.46 35,011.69 41,452.79 32,393.01 29,664.03 21,322.98 39,782.00 40,426.06 27,615.36 24,901.87 23,045.93 35,290.63 17,985.75 19,919.69 19,100.37 25,572.49 29,810.25 42,144.85 22,238.33 38,560.99 38,658.00

Date 27-Feb-2013 28-Feb-2013 29-Feb-2013 01-Mar2013 02-Mar2013 03-Mar2013 05-Mar2013 06-Mar2013 09-Mar-2013 13-Mar-2013 14-Mar-2013 15-Mar-2013 16-Mar-2013 19-Mar-2013 20-Mar-2013 20-Mar-2013 22-Mar-2013 23-Mar-2013 26-Mar-2013 27-Mar2013 28-Mar2013 29-Mar2013 30-Mar2013 02-Apr2013 03-Apr2013 04-Apr2013 09-Apr2013 10-Apr2013 11-Apr2013 12-Apr2013 13-Apr2013 16-Apr2013 17-Apr2013 18-Apr2013 19-Apr2013 20-Apr2013 23-Apr2013 24-Apr2013 25-Apr2013 26-Apr2013 27-Apr2013 28-Apr2013 30-Apr2013

Open 2,965.00 2,886.00 2,894.00 2,851.55 2,865.00 2,846.85 2,858.10 2,805.1 2,894.00 2,843.95 2,890.00 2,895.00 2,905.00 2,895.00 2,826.00 2,826.00 2,874.00 2,833.00 2,869.00 480.00 471.05 465.00 472.20 483.90 506.00 504.00 507.00 496.65 489.00 491.30 479.80 474.00 487.95 502.00 496.60 499.35 507.00 498.80 509.80 507.80 502.00 513.95 509.10

High 2,965.00 2,910.00 2,908.10 2,875.00 2,865.00 2,869.35 2,863.85 2,880.00 2,903.00 2,869.85 2,915.00 2,905.15 2,913.00 2,900.00 2,853.20 2,853.20 2,874.55 2,882.75 2,869.00 484.90 477.80 484.40 486.45 504.80 506.35 512.40 511.45 502.05 494.40 503.45 490.00 488.10 497.70 511.35 504.75 508.60 507.05 519.50 513.10 510.00 513.50 513.95 514.50

Low 2,872.00 2,854.95 2,864.20 2,805.00 2,813.10 2,846.85 2,796.70 2,801.10 2,848.00 2,842.00 2,853.95 2,870.50 2,847.15 2,811.30 2,803.00 2,803.00 2,814.30 2,830.40 2,821.10 468.15 465.65 440.60 472.20 477.50 497.90 500.00 495.05 487.40 484.15 490.35 475.00 471.00 479.30 492.45 494.30 498.05 493.10 498.25 504.05 496.25 501.00 507.25 506.00

LTP 2874.95 2880.00 2871.10 2845.35 2858.00 2854.00 2805.15 2835.00 2856.50 2860.05 2879.90 2872.00 2860.00 2835.05 2830.00 2830.00 2817.45 2875.10 2821.10 472.70 470.10 469.65 482.45 501.90 505.15 508.95 497.05 491.50 493.95 493.00 475.45 485.95 481.00 494.30 502.75 505.00 497.20 510.75 509.00 501.00 509.55 510.00 512.00

Close 2,883.35 2,872.40 2,883.45 2,856.65 2,845.70 2,858.10 2,809.85 2,852.45 2,855.30 2,859.80 2,878.85 2,881.90 2,864.95 2,837.50 2,831.35 2,831.35 2,828.30 2,872.70 2,830.75 470.80 470.60 472.15 483.25 501.25 505.40 509.05 498.30 491.00 490.00 494.40 478.95 484.80 480.85 494.30 503.45 505.35 495.55 510.20 507.60 500.95 510.95 509.45 512.05

Volume 8,63,821 9,93,775 11,08,551 12,25,829 7,59,707 21,694 7,22,557 12,93,711 8,30,601 9,63,803 13,25,261 7,81,420 11,28,876 7,57,691 11,53,173 11,53,173 7,08,080 6,87,217 6,15,333 9,53,606 6,30,267 11,74,114 6,09,050 7,57,634 4,32,535 5,01,525 6,15,175 4,59,288 8,52,411 10,35,323 13,95,377 8,36,927 12,55,051 54,82,304 11,88,656 9,80,338 5,71,571 18,87,917 10,37,383 14,54,247 10,90,908 14,102 7,21,521

Turnover 25,153.23 28,555.38 31,987.58 34,830.20 21,533.24 21,6995.23 20,368.01 36,876.31 23,887.02 27,539.76 38,203.16 22,546.73 32,536.11 21,553.10 32,598.17 32,598.17 20,126.35 19,663.69 17,457.82 4,525.04 2,964.38 5,536.70 2,912.61 3,731.56 2,175.43 2,548.81 3,112.83 2,258.62 4,172.26 5,160.34 6,724.23 4,018.73 6,104.63 27,549.58 5,954.48 4,957.10 2,848.25 9,691.92 5,270.65 7,282.80 5,557.20 71.88 3,683.58

36

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING EXPONENTIAL MOVING AVERAGE (EMA)

INTERPRETATION: In figure the red line represents faster and blue line represents slower moving averages. From figure it is obtained that the faster EMA (red line), three times crosses above and two times crosses below the slower EMA (blue line). That means three times a buy signal generated (when red line crosses above the blue line) and two times a sell signal generated (when red line crosses above the blue line) and two times a sell signal generated (when red line crosses below the blue line)

37

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING MOVING AVERAGE CONVERGENCE AND DIVERENCE (MACD)

INTERPRETATION: From the diagram it is obtained that the MACD line (red line), three times crosses above and two times crosses below the zero line. That means, three times a buy signal generated (when the red above the zero line) and two times a sell signal generated (when the red line is below the zero line). The blue line represents the MACD signal line. Here the MACD line (red line) crosses above and below the MACD signal line (blue line) at two times. These are the apt point to buy and sell the shares respectively.

38

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING RELATIVE STRENTH INDEX (RSI)

INTERPRETATION: The figure shows that there is a right time to pick up the shares, since RSI touches the oversold line (30) at two times. But there is no right to sell the shares, because it doesnt touch the overbought line (70).

39

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING RATE OF CHANGE (ROC)

INTERPRETATION: From figure it is obtained that, the ROC curve, three times crosses above and below the zero line. The region above the zero line shows the overbought area and the region below the zero Line shows the oversold area.

40

OPINION REGARDING THE SELLING OF BUYING OF SCRIPS OF HCL TECHNOLOGIES LTD DURING JAN APR 2013 Date 02-Jan-2013 03-Jan-2013 04-Jan-2013 05-Jan-2013 06-Jan-2013 07-Jan-2013 09-Jan-2013 10-Jan-2013 11-Jan-2013 12-Jan-2013 13-Jan-2013 16-Jan-2013 17-Jan-2013 18-Jan-2013 19-Jan-2013 20-Jan-2013 23-Jan-2013 24-Jan-2013 25-Jan-2013 27-Jan-2013 30-Jan-2013 31-Jan-2013 01-Feb2013 02-Feb2013 03-Feb2013 06-Feb2013 07-Feb2013 13-Feb2013 14-Feb2013 15-Feb2013 16-Feb2013 17-Feb2013 21-Feb2013 22-Feb2013 23-Feb2013 24-Feb2013 27-Feb2013 28-Feb2013 29-Feb2013 01-Mar2013 Open 389.00 397.00 406.45 418.40 414.00 419.90 417.00 419.00 423.80 415.00 406.50 397.00 422.00 426.45 421.00 422.25 70.75 71.75 73.10 72.75 74.15 73.65 73.50 78.10 463.00 455.45 463.00 470.00 470.00 470.00 470.30 478.00 489.80 495.00 492.00 491.00 494.00 486.35 484.00 481.00 High 395.00 405.70 428.00 424.90 420.00 419.90 418.80 420.65 424.90 415.20 408.10 408.40 432.50 426.70 422.55 422.25 73.00 73.40 73.50 77.15 76.45 74.55 76.95 80.40 463.45 467.95 468.50 475.00 470.35 471.25 477.10 502.90 494.95 498.00 498.00 499.85 498.00 487.20 486.10 485.00 Low 386.00 396.00 406.00 412.25 410.00 414.25 413.05 416.80 412.80 402.05 396.00 395.05 414.70 413.35 415.40 409.80 70.75 71.10 72.00 58.00 72.45 72.45 73.30 73.60 449.30 455.45 457.00 466.05 462.30 466.25 469.40 478.00 486.30 484.50 490.45 482.40 480.25 472.45 481.95 474.55 LTP 394.00 403.00 418.95 412.90 418.15 415.00 416.00 419.95 415.85 406.00 398.50 407.65 425.15 415.00 417.75 416.45 72.25 72.60 72.25 76.50 73.00 73.30 75.70 74.20 450.50 461.15 460.00 467.50 468.60 469.25 476.00 491.70 491.50 493.50 496.15 493.30 486.10 483.40 484.95 481.90
41

Close 393.60 403.20 418.40 414.75 417.55 415.05 414.95 419.90 415.30 405.75 397.75 405.95 425.40 417.45 418.95 417.65 72.00 72.60 72.30 76.15 73.00 73.45 76.15 74.10 454.00 462.75 460.60 468.30 468.25 469.70 476.05 492.55 493.75 492.10 495.40 492.85 484.60 482.30 484.95 482.00

Volume 5,24,788 25,35,805 23,68,787 8,07,992 8,18,065 42,128 5,39,153 15,74,329 7,41,919 11,11,377 13,74,576 8,28,158 47,90,096 13,80,201 7,56,692 7,60,332 27,89,513 31,69,547 29,46,294 1,09,74,107 44,81,253 36,15,003 81,22,814 1,24,63,099 7,09,288 13,05,922 7,16,147 3,49,981 3,01,195 4,17,528 7,89,511 18,72,413 8,30,256 10,79,738 12,75,407 7,32,279 12,14,560 8,74,637 6,72,895 4,20,986

Turnover 2,061.95 10,204.55 9,924.45 3,386.25 3,416.55 175.28 2,244.60 6,607.98 3,110.74 4,520.68 5,499.87 3,343.87 20,365.44 5,824.71 3,172.87 3,166.54 2,010.77 2,290.58 2,136.04 8,096.65 3,311.57 2,651.03 6,136.13 9,572.41 3,227.69 6,045.62 3,324.16 1,647.42 1,407.99 1,960.50 3,747.08 9,154.15 4,083.94 5,332.56 6,307.14 3,616.45 5,964.14 4,194.44 3,257.24 2,023.37

Date 02-Mar-2013 03-Mar-2013 05-Mar-2013 06-Mar-2013 07-Mar-2013 09-Mar-2013 12-Mar-2013 13-Mar-2013 14-Mar-2013 15-Mar-2013 16-Mar-2013 19-Mar-2013 20-Mar-2013 21-Mar-2013 22-Mar-2013 23-Mar-2013 26-Mar-2013 27-Mar-2013 28-Mar-2013 29-Mar-2013 30-Mar-2013 02-Apr-2013 03-Apr-2013 04-Apr-2013 09-Apr-2013 10-Apr-2013 11-Apr-2013 12-Apr-2013 13-Apr-2013 16-Apr-2013 17-Apr-2013 18-Apr-2013 19-Apr-2013 20-Apr-2013 23-Apr-2013 24-Apr-2013 25-Apr-2013 27-Apr-2013 28-Apr-2013 30-Apr-2013

Open 487.00 480.00 477.20 482.00 479.50 497.20 507.00 508.00 510.00 502.40 499.00 494.05 499.00 489.50 492.00 480.80 487.90 480.00 471.05 465.00 472.20 483.90 506.00 504.00 507.00 496.65 489.00 491.30 479.80 474 487.95 502 496.6 499.35 507 498.8 509.8 502 513.95 509.1

High 487.00 484.85 483.95 491.50 496.80 513.20 512.00 509.90 519.20 505.75 506.00 502.45 500.95 497.00 495.85 488.90 504.50 484.90 477.80 484.40 486.45 504.80 506.35 512.40 511.45 502.05 494.40 503.45 490.00 488.1 497.7 511.35 504.75 508.6 507.05 519.5 513.1 513.5 513.95 514.5

Low 476.00 480.00 469.55 475.00 474.50 497.20 500.20 496.20 502.15 493.35 490.60 488.00 485.70 487.95 469.50 475.50 471.50 468.15 465.65 440.60 472.20 477.50 497.90 500.00 495.05 487.40 484.15 490.35 475.00 471 479.3 492.45 494.3 498.05 493.1 498.25 504.05 501 507.25 506

LTP 483.15 480.40 480.65 480.50 495.00 504.00 508.00 506.60 503.50 496.00 498.00 499.00 489.00 492.00 477.00 484.55 476.50 472.70 470.10 469.65 482.45 501.90 505.15 508.95 497.05 491.50 493.95 493.00 475.45 485.95 481 494.3 502.75 505 497.2 510.75 509 509.55 510 512

Close 481.65 481.85 480.85 481.40 494.90 506.90 506.95 505.10 504.80 496.20 497.15 498.95 492.00 491.85 477.00 484.95 477.35 470.80 470.60 472.15 483.25 501.25 505.40 509.05 498.30 491.00 490.00 494.40 478.95 484.8 480.85 494.3 503.45 505.35 495.55 510.2 507.6 510.95 509.45 512.05

Volume 2,97,784 15,943 2,93,870 5,70,789 7,25,582 16,75,244 12,86,670 11,09,657 9,13,924 5,11,564 6,97,277 29,07,052 5,02,713 6,55,722 12,90,270 26,96,410 28,37,564 9,53,606 6,30,267 11,74,114 6,09,050 7,57,634 4,32,535 5,01,525 6,15,175 4,59,288 8,52,411 10,35,323 13,95,377 836927 1255051 5482304 1188656 980338 571571 1887917 1037383 1090908 14102 721521

Turnover 1,433.36 76.84 1,395.39 2,767.87 3,548.28 8,475.14 6,544.69 5,589.72 4,638.45 2,549.64 3,486.41 14,392.19 2,492.80 3,228.24 6,207.92 13,063.23 13,566.30 4,525.04 2,964.38 5,536.70 2,912.61 3,731.56 2,175.43 2,548.81 3,112.83 2,258.62 4,172.26 5,160.34 6,724.23 4018.73 6104.63 27549.58 5954.48 4957.1 2848.25 9691.92 5270.65 5557.2 71.88 3683.58

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FORECASTING FUTURE PRICE TRENDS OF STOCKS USING EXPONENTIAL MOVING AVERAGE (EMA)

INTERPRETATION: In figure red line represents faster and blue line represents slower moving average. From figure it is obtained that the faster (EMA)(red line), four times crosses above and three times crosses below the slower EMA (blue line). That means four times a buy signal generated (when red line crosses above the blue line) and three times a sell signal generated (when red line crosses below the blue line)

43

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING MOVING AVERAGE CONVERGENCE AND DIVERGENCE (MACD)

INTERPRETATION: From the diagram it is obtained that red line, three times crosses above and two time crosses below the zero line. That means, three times a buy signals is generated(when the red crosses above the zero line) and two times a sell signals is generated(when the red line crosses below the zero line). The blue line represents the MACD signal line. Here the MACD(red line), four times crosses below the MACD signal line(blue line). There are the apt point to buy and sell the shares respectively.

44

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING RELATIVE STRENGTH INDEX (RSI)

INTERPRETATION: The figure shows that there is no right time to sell or pick up the shares from the feb-01 to may-01,because the RSI oscillator oscillate in between the oversold line (30) & over bought line(70).

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FORECASTING FUTURE PRICE TRENDS OF STOCKS USING RATE OF CHANGE (ROC)

INTERPRETATION: From figure it is obtained that, the ROC curve, five times crosses above and four times crosses below the zero line. The region above the zero line shows the overbought area and the region below the zero line shows the oversold area.

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OPINION REGARDING THE SELLING OR BUYING OF SCRIPS OF TATA CONSULTANCY SERVICES LTD DURING JAN APR 2013 Date 02-Jan-2013 03-Jan-2013 04-Jan-2013 05-Jan-2013 06-Jan-2013 07-Jan-2013 09-Jan-2013 10-Jan-2013 11-Jan-2013 12-Jan-2013 13-Jan-2013 16-Jan-2013 17-Jan-2013 18-Jan-2013 19-Jan-2013 20-Jan-2013 23-Jan-2013 24-Jan-2013 25-Jan-2013 27-Jan-2013 30-Jan-2013 31-Jan-2013 01-Feb-2013 02-Feb-2013 03-Feb-2013 06-Feb-2013 08-Feb-2013 09-Feb-2013 10-Feb-2013 13-Feb-2013 14-Feb-2013 15-Feb-2013 16-Feb-2013 17-Feb-2013 21-Feb-2013 22-Feb-2013 23-Feb-2013 24-Feb-2013 27-Feb-2013 28-Feb-2013 Open 1,161.00 1,183.25 1,204.90 1,172.80 1,166.00 1,170.00 1,171.00 1,175.00 1,171.40 1,101.00 1,097.15 1,084.00 1,119.90 1,080.00 1,087.00 1,079.95 1,086.00 1,088.00 1,094.90 1,105.00 1,102.50 1,113.00 1,129.40 1,136.00 1,145.00 1,183.70 1,216.40 1,211.10 1,228.00 1,222.20 1,225.00 1,227.15 1,238.00 1,234.85 1,223.55 1,235.00 1,249.05 1,259.00 1,279.00 1,255.25 High 1,185.95 1,209.90 1,205.00 1,185.00 1,188.35 1,178.75 1,179.70 1,185.50 1,175.00 1,115.00 1,103.35 1,114.00 1,124.70 1,096.30 1,088.90 1,090.95 1,091.45 1,095.00 1,109.95 1,120.55 1,118.95 1,135.90 1,135.00 1,152.65 1,176.00 1,200.05 1,226.85 1,232.00 1,238.00 1,237.95 1,229.55 1,248.80 1,242.00 1,254.00 1,240.00 1,266.85 1,274.90 1,280.85 1,279.95 1,260.40 Low 1,153.00 1,180.00 1,169.30 1,167.35 1,156.80 1,170.00 1,165.25 1,158.50 1,133.15 1,068.65 1,073.00 1,078.90 1,094.00 1,045.30 1,065.40 1,073.00 1,074.15 1,078.00 1,091.05 1,100.10 1,100.75 1,113.00 1,108.25 1,130.30 1,141.00 1,173.35 1,211.00 1,188.00 1,212.00 1,214.00 1,215.00 1,219.50 1,218.00 1,221.00 1,204.75 1,229.00 1,244.00 1,257.25 1,245.60 1,219.10
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LTP 1177.90 1197.00 1170.75 1171.20 1170.95 1172.00 1172.30 1168.00 1135.55 1096.35 1085.45 1108.80 1105.25 1073.00 1075.00 1076.55 1076.25 1085.55 1095.20 1108.70 1112.25 1131.00 1131.00 1150.00 1169.70 1197.60 1220.00 1229.95 1228.00 1228.00 1221.00 1238.20 1222.30 1225.35 1235.95 1246.20 1254.30 1268.00 1250.00 1227.60

Close 1,178.60 1,197.60 1,173.00 1,172.00 1,169.40 1,172.50 1,171.35 1,165.40 1,137.00 1,089.50 1,085.75 1,109.40 1,103.95 1,076.15 1,075.55 1,079.50 1,077.70 1,088.70 1,098.00 1,108.75 1,111.75 1,132.40 1,128.70 1,148.00 1,171.55 1,193.85 1,219.65 1,228.60 1,233.40 1,225.70 1,220.00 1,241.60 1,225.35 1,228.75 1,237.05 1,252.35 1,259.80 1,270.00 1,252.05 1,226.55

Volume 11,24,271 13,54,442 11,93,385 12,73,656 10,59,864 67,051 7,54,514 17,95,895 28,37,690 47,64,342 20,09,914 15,23,601 18,52,109 58,32,766 20,81,646 12,86,347 10,65,248 13,20,655 29,22,619 26,04,859 12,97,779 17,69,060 11,44,402 16,93,070 13,88,779 17,13,598 18,13,592 15,19,031 11,62,151 8,15,885 9,13,323 10,83,583 9,43,330 20,48,284 12,44,752 15,70,913 20,43,440 11,73,200 9,30,685 19,86,745

Turnover 13,188.77 16,245.78 14,141.60 14,972.25 12,390.10 787.01 8,849.60 20,972.40 32,575.63 51,833.99 21,799.63 16,828.63 20,479.94 62,633.68 22,337.85 13,919.40 11,533.55 14,358.29 32,218.80 28,946.61 14,443.84 19,953.68 12,820.99 19,358.88 16,103.16 20,375.97 22,141.91 18,441.43 14,245.30 9,979.76 11,154.75 13,424.25 11,589.98 25,323.57 15,231.84 19,689.01 25,717.30 14,926.98 11,771.40 24,420.97

Date 29-Feb-2013 01-Mar-2013 02-Mar-2013 03-Mar-2013 05Mar2013 06-Mar-2013 07-Mar-2013 09-Mar-2013 12-Mar-2013 13-Mar-2013 14-Mar-2013 15-Mar-2013 16-Mar-2013 19-Mar-2013 20-Mar-2013 21-Mar-2013 22-Mar-2013 23-Mar-2013 26-Mar-2013 27-Mar-2013 29-Mar-2013 30-Mar-2013 02-Apr-2013 03-Apr-2013 04-Apr-2013 09-Apr-2013 10-Apr-2013 11-Apr-2013 12Apr-2013 13-Apr-2013 16-Apr-2013 17-Apr-2013 18-Apr-2013 19-Apr-2013 20-Apr-2013 23-Apr-2013 24-Apr-2013 25-Apr-2013 26-Apr-2013 27-Apr-2013 28-Apr-2013 30-Apr-2013

Open 1,240.00 1,223.00 1,226.00 1,219.00 1,214.00 1,203.00 1,195.00 1,227.00 1,215.90 1,190.00 1,210.10 1,159.00 1,169.95 1,169.55 1,129.00 1,136.95 1,174.70 1,175.00 1,177.00 1,173.00 1,151.00 1,145.50 1,170.00 1,200.20 1,169.00 1,170.00 1,166.30 1,149.70 1,140.25 1,091.35 1065.25 1085 1100 1100.9 1093.25 1093.95 1122 1189 1170 1190 1200 1204

High 1,240.00 1,226.95 1,227.00 1,223.85 1,222.45 1,221.30 1,206.00 1,227.00 1,218.85 1,214.95 1,214.00 1,170.95 1,180.00 1,169.55 1,145.00 1,179.80 1,189.70 1,191.90 1,185.00 1,179.65 1,164.00 1,175.75 1,199.00 1,207.35 1,189.80 1,188.00 1,175.65 1,155.00 1,148.00 1,104.70 1074.3 1094.95 1114.7 1106.8 1107.95 1102.4 1205 1190 1201.9 1212 1205 1250

Low 1,212.25 1,210.05 1,207.00 1,213.00 1,201.00 1,189.00 1,186.55 1,202.95 1,183.20 1,190.00 1,151.00 1,145.00 1,158.00 1,111.80 1,120.00 1,136.55 1,160.00 1,164.80 1,154.00 1,151.95 1,132.40 1,145.50 1,170.00 1,175.30 1,167.00 1,158.25 1,152.25 1,135.20 1,129.10 1,061.25 1053.3 1073.8 1093.85 1091.1 1077.4 1047.65 1117.3 1167.5 1164.5 1190 1196.1 1204

LTP 1220.90 1219.00 1219.00 1213.00 1208.10 1190.00 1195.90 1207.10 1185.60 1198.80 1152.00 1164.80 1163.60 1124.75 1133.70 1173.95 1167.20 1185.00 1158.00 1176.00 1148.95 1165.00 1198.00 1175.75 1179.75 1165.35 1155.95 1139.70 1132.50 1065.00 1070 1094.4 1095 1103.05 1093.55 1065.9 1198.95 1170.05 1198.3 1200.1 1203 1250

Close 1,221.95 1,219.60 1,217.25 1,218.40 1,207.30 1,202.00 1,192.85 1,208.55 1,189.05 1,197.00 1,154.55 1,163.70 1,169.55 1,122.00 1,134.85 1,175.75 1,167.75 1,184.65 1,161.60 1,174.75 1,141.20 1,168.80 1,194.25 1,178.00 1,178.45 1,164.10 1,156.20 1,138.10 1,131.65 1,068.35 1069.75 1090.85 1097.55 1102.95 1088.45 1064.25 1194.2 1171.05 1194.65 1204 1201.85 1246.6

Volume 15,30,108 7,84,297 11,54,616 32,711 7,70,439 8,58,861 9,72,833 11,12,879 11,20,139 12,46,232 40,32,657 21,42,118 10,27,362 25,66,432 18,41,602 22,76,621 17,10,847 15,79,218 15,26,692 7,94,123 13,40,607 12,71,671 11,63,494 11,34,577 10,82,527 7,88,314 7,66,496 8,90,793 10,57,343 44,97,340 2508055 1236832 1441132 883708 1225012 1421934 9056891 2708949 2738146 1855573 51873 2302411

Turnover 18,750.53 9,553.93 14,034.94 398.95 9,326.66 10,351.91 11,624.71 13,482.30 13,377.13 14,979.33 47,233.51 24,829.34 12,036.51 28,875.34 20,937.09 26,591.57 20,112.55 18,702.99 17,738.89 9,261.20 15,339.01 14,793.56 13,807.29 13,427.22 12,777.43 9,269.33 8,879.20 10,190.09 12,019.74 48,575.10 26734.56 13412.1 15876.97 9717.17 13399.71 15349.46 106098.6 31909.93 32518.09 22317.36 622.35 28481.85

48

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING EXPONENTIAL MOVING AVERAGE (EMA)

INTERPRETATION: In figure the red line represents faster and blue line represents slower moving averages. From figure it is obtained that the faster EMA (red line), two times crosses above and one time crosses below the slower EMA (blue line). That means two times a buy signal generated (when red line crosses above the blue line) and one time a sell signal generated (when red line crosses below the blue line).

49

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING MOVING AVERAGE CONVERGENCY AND DIVERGENCE (MACD)

INTERPRETATION: From the diagram it is obtained that red line, two times crosses above and one time crosses below the zero line. That means, two times a buy signal is generated (when the red crosses above the zero line) and one time a sell signal is generated (when the red line crosses below the zero line). The blue line represents the MACD signal line. Here the MACD (red line), three times crosses above and two times crosses below the MACD signal line (blue line). These are the apt point to buy and sell the shares respectively.

50

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING RELATIVE STRENGTH INDEX (RSI)

INTERPRETATION: The figure shows that there is a right time to pick up the shares, since RSI crosses the oversold line (30). But there is no right time to sell the shares, because it doesnt touch the overbought line (70).

51

FORECASTING FUTURE PRICE TRENDS OF STOCKS USING RATE OF CHANGE (ROC)

INTERPRETATION: From figure it is obtained that, the ROC curve, four times crosses above five times crosses below the zero line. The regain above the zero line shows the overbought area and the region below the zero line the zero line shows the oversold area.

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6.1 FINDINGS Findings relating to the companies selected for the technical analysis: From the four technical analysis tools I have used, it is identified that the sell and buy signals were obtaining alternatively. So the shares of INFOSYS, HCL, and TCS are appropriate shares for speculators. According to RSI it is identified that the shares of HCL are more are ideal securities to hold. So it is more appropriate securities to moderate risk seekers and long term investors. According to most of the tools, I have used, it is identified that, the securities of INFOSYS, & TCS suitable securities to high risk seekers and long term investors.

Findings related to technical analysis tools: The technical analysis tools are more helpful for speculators than investors. The exponential moving average is more powerful tool than simple moving average because EMA is quicker to respond to price fluctuations than a simple moving average. The disadvantage of EMA over simple moving average is that EMA is more prone to whipsaws (i.e. false signals). It is found that the MACD is not only good for buy and sell signals, the MACD can be used for warnings of potential change in the direction of stocks, futures, and currency pairs. Apart from showing overbought and oversold conditions the ROC can be used to confirm price moves or detect divergences.

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6.2 SUGGESTIONS Technical analysis will improve the investment decision. Technical analysis is simple and more reliable then fundamental analysis because the information required for technical analysis is free available as compared to fundamental analysis. Even though technical analysis is enough for making decision in stock market. Simultaneous usage of both fundamental and technical analysis will reduce errors in forecasting future prices. Before going to invest, an investor should have clear knowledge of capital market so it is the part of the company to educate the investor with relate to all the types of investment alternatives available. Investor should have knowledge regarding the market terms so that they can take maximum return from maximum investment. As the long term investment is more favour to the company as it can enjoy the benefit of long term cash reserve the marketer should try to push and pull more and longer term investment from the investors. Also it is necessary to keep in mind that only maintaining more and more fund reserve only should not be the sole objective of the company, it should predict the future changes in the value of money, by changing its mind set the company should also play the role of fund creator. Investors perceive that the stock market activities are risky and they hesitate to come forward to invest in stock market, so the company has to execute such programs that train

54

and educate the investors about the benefits part of stock market investment and the return they get from it. As in case of stock market half knowledge is very dangerous. So it is the responsibility of the company to train the employees and technical analysts to make them experts in subject of stock market, so that they become experts to solve all the queries of the investors without any wrong information or hesitation and solve the confusions of the investors to increase the investment. Suggestions for Indiabulls securities ltd: Add new customer service to service profile-technical analysis. It may result in high profits for the company. The customer can be charged for the service offered. It will also add goodwill to the company. Suggestion relating companies selected for the technical analysis: The risk is common for all securities. The scrip that is having low may also be subject to high risk. The main reason is that market is unpredictable. So the investor must invest carefully. Since risk is involved in every scrip, greater emphasized is given to return in each investment. On the basis of study, suggested ranking of scrip is as follows. The rank is given on the basis of return. Rank 1 2 3 Company INFOSYS TCS HCL

55

Suggestions to technical analysts: In the world of technical analysis, there are hundreds of tools available to predict the nature of the securities. Most of the technical analysts are using n no: of tools at a time and they dont like to say that one tool is far better than another. That means each and every tool having their own important. So my suggestion is like for analyzing the scrips better to use all possible tools and reach the interpretation by analyzing all the angles of the scrips

56

6.3 CONCLUSION

Technical analysis is an alternative approach to stock selection. Today the world of technical analysis is huge and it is used by large number of institutional and individual traders. Technical analysts consider the market to be 80% psychological and 20% logical. Psychological or logical may be open for database, but there is no questioning the current price of a security. After all, it is available for all to see and nobody doubts its legitimacy. The price set by the market reflects the sum knowledge of all participants. These participants have considered (discounted) everything under the sum and settled on a price to buy or sell. These are the forces of supply and demand at work. By examining price action to determine which force is prevailing, technical analysis focuses directly on the bottom line: what is the price? Where has it been? Where is it going? Even though there can some universal principal and rules that can be applied, it must be remembered that technical analysis is more an art than a science. As a form of art, it is subject to interpretation. However, it is also flexible in its approach and each participant should use only that which suits his or her style. Developing a style takes time, effort and dedication, but the rewards can be significant.

57

BIBLIOGRAPHY

Books: CLIFFORD PISTOLESE Using Technical Analysis, the Basics C.R KOTHARI Research methodology: second edition new age international publication PUNITHAVATHY PANDIAN Security analysis and portfolio management MARTIN J.PRING Technical analysis Websites: www.icharts.in www.onlinetradingconcepts.in www.indiabulls.com www.moneycontrol.com

Reports: Company Annual Reports. FAQ provided by company

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