Eye Keypoints for Potential Reversal (Technicals + Fundamentals)
In the past several weeks, we've observed the following market movements:
1. First Uptrend: Over 23 weeks (161 days), the price increased from around 64 to 124 with a substantial volume of 438.94M.
2. First Downtrend: Following this, the price declined over 11 weeks (77 days) from 124 to 108, with a volume of 237.994M.
3. Second Uptrend: The price then rebounded over 18 weeks (126 days) from 107 to 168, supported by a volume of 319.661M.
Currently, we are in the 11th week of the latest downtrend, where the price has decreased from 168 to around 140, with a volume of 282.442M.
Key Insights:
Next Steps:
Furthermore, if we expect a dividend of 30 Rs next year and the expected interest rate is 15%, then the target price based on the dividend can also be calculated as follows:
Target Price = Expected Next Year Dividend / Expected Next Year Interest Rate
Target Price = 30 / 0.15 = 200 Rs
Conclusion:
While the current short-term trend is bearish (11 bars area), the increased volume hints at a possible reversal soon. With a projected dividend of 30 Rs next year and an expected interest rate of 15%, the target price based on dividends would be 200 Rs. This fundamental target supports the technical signals suggesting potential upward movement. Proper risk management and self-study should be incorporated.
1. First Uptrend: Over 23 weeks (161 days), the price increased from around 64 to 124 with a substantial volume of 438.94M.
2. First Downtrend: Following this, the price declined over 11 weeks (77 days) from 124 to 108, with a volume of 237.994M.
3. Second Uptrend: The price then rebounded over 18 weeks (126 days) from 107 to 168, supported by a volume of 319.661M.
Currently, we are in the 11th week of the latest downtrend, where the price has decreased from 168 to around 140, with a volume of 282.442M.
Key Insights:
- The current downtrend mirrors the previous downtrend in duration (11 weeks) and volume.
- The proximity of the current volume to past downtrends suggests we may be nearing a reversal point.
- If historical patterns hold, we might anticipate a potential price rebound beginning within the next week or two.
Next Steps:
- Monitor for an increase in volume (towards the 300M+ range) to confirm a reversal signal.
Target a potential price high of around 200 to complete this cycle if the upward trend resumes.
Furthermore, if we expect a dividend of 30 Rs next year and the expected interest rate is 15%, then the target price based on the dividend can also be calculated as follows:
Target Price = Expected Next Year Dividend / Expected Next Year Interest Rate
Target Price = 30 / 0.15 = 200 Rs
Conclusion:
While the current short-term trend is bearish (11 bars area), the increased volume hints at a possible reversal soon. With a projected dividend of 30 Rs next year and an expected interest rate of 15%, the target price based on dividends would be 200 Rs. This fundamental target supports the technical signals suggesting potential upward movement. Proper risk management and self-study should be incorporated.
Note
In the short term, it was in a bearish trend, as mentioned in the conclusion. However, due to an unexpected government action, its dynamics have been changed, particularly regarding the dividend policy, which could take a significant hit—a key factor I used for value realization (Fundamentally). There is still no update from HUBCO management, but if the dividend policy does really change (which is obvious after contract termination), this stock should be re-analyzed through a different lens, potentially a growth-oriented one & Fair value + Target value would be different.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.