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Milan Vaishnav, CMT, MSTA

Milan Vaishnav, CMT, MSTA

Milan Vaishnav, CMT, MSTA, Founder of Gemstone Equity Research and Advisory Services. He works as a Independent Technical Research Analyst. With carrer spanning over 18 years in the Indian Capital Markets, Milan’s primary responsibilities include consulting in Portfolio/Funds Management and Advisory Services. It involves expertise in Tailor-made and customized Portfolio Research, conducting Mandated Research for the Portfolio(s) under advisory, formulating strategies, and working in sync with the Client’s team on a real-time basis when required. Milan also authors “Daily / Weekly Market Outlook” — A Daily / Weekly Newsletter, currently in its 18th year of publication.

Along with being a Featured Commentator on StockCharts.com, he presently contributes on a daily basis to ET Markets and The Economic Times – INDIA’s leading Financial Daily. Milan also contributes frequently to Financial Express of the Indian Express Group and has also contributed to Dalal Street Investment Journal (DSIJ), Business World, and is frequently quoted by The Financial Express and BloombergQuint.

He is the Member of CMT Association (Formerly known as Market Technical Association — MTA), USA, Member of Society of Technical Analysts, (STA), UK, and Canadian Society of Technical Analysts, (CSTA), CANADA. He also holds SERIES XV, a regulatory requirement of the Securities and Exchange Board of India (SEBI) and is registered as Research Analyst with SEBI.

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            [post_content] => Welcome readers, to another edition of Technical Insights! 

It’s been a difficult couple of months as we deal with the second wave of a virus that has taken over a better part of our lives for more than a year now. I sincerely hope that you and your families are safe and healthy. 
 

The market too has reflected a similar rollover in sentiment, which naturally continues to play out even now. It’s amazing how the market acts as a living, breathing organism that ebbs and flows with the emotion of its main constituent- the people. 
 

While we continue to observe long-term base breakouts in indices across the globe, we’re also witnessing a slow-down in momentum in a few. But what does that mean for market participants? Well, for starters, one would have to be fastidious in their selection process. To get a slice of this pie, one would have to pay greater attention to detail, focus on sector rotation and plan their portfolios accordingly. We’re not in the 2020 market rally where stock selection was relatively much easier! But then again, as technical analysts I think we’re built to handle such market moves. 
 

But what does it mean to be a technical analyst? This is my take on it. 
 

As a technical analyst, one is expected to observe price data and the trends that have formed in the past, to gauge the possible future outcomes. Does that mean that a particular view is set in stone? Certainly not. Can the analyst be wrong in their analysis? Most definitely. Does that mean one should give up when they’re wrong? Not at all! The beauty of this subject is that you can be on both sides, but you will always be protected by a risk management strategy (that is, if you are vigilant).  

In my opinion technical analysts have what it takes to excel in any market conditions. At the core of this belief is that for every given trade, all the levels are in place. Entry as well as Exit (be that a target or a stop loss).  

 

So, what’s the caveat? Patience. Years of learning and experience lead to sharp analysis and execution. As a field, it demands your complete attention and takes you on a roller coaster ride before you’re ready for the next one!  

 

To all those who are finding their way, give it time and a lot of introspection. Eventually you will reach a point where failed moves won’t deter you and successful moves won’t blur you. That’s the goal!  

Since the market has been messy for the most part, this month we have a write-up each about the outlook in Equities, Gold and INR. In addition to this we have a blog on stock specific pattern identification as well.  

P.S - The Americas Summit 2021 concluded recently and I had the rare honour of appearing as a speaker. It was truly an enriching experience and if you haven’t already, I’d definitely encourage you to check out the videos on the Digital Guide. There’s decades of information in those few hours of content that is certainly worth your time! 
 

Until we meet againThink Technical!  

Rashmi Shastry, CMT

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            [post_content] => Head & Shoulders, Cup & Handle, Hanging man, Shooting Star, Island Reversal, Bullish Belt Hold etc are a few of the very many perfect examples of ‘how to make a subject interesting’. In a field that’s considered more complicated than rocket science (not my view), you’ve got to give it to the learned people to truly make this subject quite fascinating. They certainly managed to pique my interest, and I’m sure I’m not alone!

Any activity that results directly into the money reserve moving higher or lower involves stress. But there’s a combat for that in the form of risk management, which Is Technical Analysis’ biggest strength.  It’s the one thing that acts as a life boat in troubled waters.

Market participants over the past couple of months have been dealing with a market that has been moving in a trading range. Now this is where things become interesting. As a trader one must decide for themselves (depending on past experience of course) as to whether or not this is their playing field. There are certain people who excel at range-bound trading and others who look for swing moves. While these are learnings that we identify only after spending a considerable amount of time in the market, these learning can be elusive if not approached with the attention that they demand. When life is a mess, it makes sense to sit back, observe, plan and then execute. Similarly, when the market is in a mess, it is important to sit back and observe until you feel like joining the party again.

The beauty of this field is that you will learn things about your temperament, psyche, approach and reactions much faster than in any other field because these are what make up your arsenal. There is a common idea which involves wanting to defeat the market. But that is not the point of investments and trading. The point is to move with the market. Once it becomes a game of winning or losing, you are putting yourself in a place of superiority or inferiority. The market is not fond of one of these positions, and we all know which one! Take the phrase ‘The trend is your friend’ more seriously and life will be more peaceful!

This month we bring to you book reviews, breadth analysis, price analysis and the classic practice of ‘when in doubt, zoom out!’.

Until we meet again, Think Technically!

Rashmi Shastry, CMT

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            [post_content] => Welcome readers to another edition of Technical Insights! 

What an exciting time to be in the market right now. If you are appearing for the CMT examination, or are studying to be a technical analyst, this is as best a time as ever to watch concepts move seamlessly from books to the charts. 

We're hearing a lot about the rise in bond yields and the US dollar and the kind of impact it could have on the stock and commodity markets. This is a lesson in asset class correlation with relationships unfolding right in front of your eyes! While a lot of times we get caught up in the bookssyllabus and exams, this is a very good time to look up and notice what’s happening in the market. Also, a good time to go through John Murphy’s Intermarket Analysis, there’s so much wisdom there! 

The market is structured in such a way that it forms one big puzzle when everything is put together. There are correlations- positive and negative, there are contra-trades/concepts, there’s plain and simple price analysis as well as intricate Elliott wave pattern analysis. Its one large buffet that’s open to everyone. You pick the items that you think work for you and your palate (here-analysis style) and go about enjoying your meal. But always make sure that those items are selected after going through the entire spread! You don’t want to miss out on a scrumptious dish just because you stocked up on too much of another dish.  

One thing to keep in mind is to always go by the weight of the evidence. Today we’re looking at yields and US Dollar, tomorrow we could look at commodities for another signal. As a technical analyst, it is important to make decisions by weighing the evidence and then making a decision. There is no single magical indicator out there so the sooner you quit hunting for it, the better. No one piece of the puzzle is more important or superior than the other. It will be a struggle in the beginning to make a structure that suits your personal requirements. But keep at it, and let the charts talk to you. Don’t tell the charts what to do, they never listen!! 

Rashmi Shastry, CMT

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            [post_content] => Hello Readers and welcome to a brand-new Issue of Technical Insights in a brand-new year!

 

As 2021 begins, renewed hopes and aspirations engulf the world that slowly moves towards normalcy after it was exposed to the systematic risk of an unprecedented kind. So what is it that is giving people hope?

Is it the phenomenal Bull market rally that has been witnessed? Is it the news of vaccination hitting the shelves? Or is it just the change from '0' to '1' in the digits of the year? Whatever it may be, hope is a powerful catalyst. It compels us to believe and work towards a better tomorrow irrespective of what the present scenario is.

As an analyst, I hope that I never take the market for granted. I hope to remain humble in my approach towards my charts and listen to what they have to say. I hope to understand the emotions that govern the chart and hence the price.

As the market continues its gravity-defying move, varied perspectives and valuable insights have been collated to analyse this meteoric rise. Gautam Shah has highlighted how one could read indicators at current levels and how the approach must be tweaked according to market conditions. Kush Ghodasara has used simple concepts of Technical Analysis to arrive at long-term investment ideas. Wishing you a joyful and profitable New Year.

 

Until next time, think Technical!
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            [post_content] => Hello readers!  

We are now in the 12th and final month of a year that has been a roller coaster ride throughoutGlobal indices are now clocking all-time highs after correcting by almost 50% in the beginning of the year. There were those who made money, those who lost money and those who learnt a lot from the markets this year regardless of the monetary gain/loss. And that needs to be our prime focus. As long as the learning is in place, you’ve gained in this market.  

Everything is Relative Strength is everything 

When I was studying for my CMT Level III exam, I came across this chapter by Julius de Kempenaer. I read the title over and over again. I was amazed by that statement and the validity that it holds universally. What we see, believe and feel is all relative. For the most part, we don’t deal with absolute perceptions or ideas. Everything is in relative terms based on the variables we’ve been exposed to in the past. Just as we choose a particular asset class based on its relative strength among other asset classes, we make choices in life based on the relative strength of those decisions over others. Similarly, there are numerous concepts that could be picked up from the market and incorporated in our lives because at the core of these concepts are basic human emotions and reactions.  

Market participants (like myself) who witnessed extreme moves in global indices across the globe this year for the first time, have been exposed to important lessons early in their career. While this year has been difficult for many reasons, it has taught us innumerable lessons in a short span of time. For me, this year has reiterated the importance of basic concepts and understanding which often get clouded by over analysis and over thinking. As an analyst sometimes one’s judgement gets clouded by expectation rather than by reaction. We are not here to dictate or predict patterns and scenarios. We are here to react to the price to the best of our risk management abilities and move with the trend.  

To all the aspirants appearing for their exams this December, make sure your basic foundations are strong, because in turbulent times like the March 2020 crash, the very same basics can bail you out.   

Until next time, Think Technical!  

Rashmi Shastry, CMT
Editor, Technical Insights
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            [post_content] => Hello Readers!  

Wishing all of you a prosperous and healthy Diwali in advance. May this festival light up your lives, both personally and professionally! 

The recently concluded CMT 2020 India Virtual Summit was a great successWorld class speakers graced us with their virtual presenceand I can confidently say that there are decades of learnings in the recordings of these sessions that any analyst would benefit from immensely! A big thank you to all the Speakers and participants for making this Summit a memorable one. For all those who missed it, we have compiled some session descriptions and have dedicated this edition of the Newsletter to the Summit. There’s GOLD in these sessions, so do make sure that you go through them before the online video recordings expire on November 16, 2020!   

If you had already registered for the Summit, log back in to your digital event guide to access the recordings. If you hadn't registered for the Summit, you can register to view the recordings here https://cmtassociation.org/events/2020-india-regional-summit/

As a market participant, there are certain concepts that you learn through personal, rigorous study and certain concepts that you learn by simply being a part of the system. I recently came across interesting analogies in Sanskrit and found it quite relevant to us. 

Markata Kishor Nyayam: (Baby monkey principle/law) 

You must’ve noticed that the mother monkey moves swiftly from one branch to another while the baby monkey hangs on with a tight grip so as to not fall. Here, the baby focuses on the grip, while the mother focuses on movement alone.  

Marjaala Kishor Nyayam: (Baby cat principle/law) 

A mother cat carries its kitten in its mouth to move them to safety or to a different location. Here, the onus lies on the mother to make sure that she doesn’t drop or hurt the kitten while holding on to it with a delicate balance of grip and care. The kitten surrenders itself to the mother. 

As traders and analysts we spend countless hours understanding various aspects of the market by holding on to it with a tight grip, as it swings from bull cycles to bear cycles, just like a baby monkey holds on to its mother. There are also times when we understand concepts by being part of the market where the market guides us and helps us, just like a mother cat doesOne cannot always be as tenacious as a baby monkey or as laid back as a kitten. It is a combination of these two approaches that leads to a fulfilling understanding of a subject. 

In order to improve our trade, it is imperative to revisit the involuntary errors we make and work towards overcoming them together: 
  1. I will refrain from saying “I told you so” (this one is particularly difficult in our field) 
  2. I will not compare my Chapter 8 to someone else’s Chapter 20  
  3. I will not blame the market for my errors (this is just convenient. Why would the market single you out?)  
  4. will exit the trade once it has triggered my stop loss; not average it (aren’t all of us guilty of this at some point?) 
  5. I will identify patterns on charts without forcing them (if I just tweak the lines a little, I can make it look like a triangle…maybe) 
  6. I will focus on being unbiased (My way or the highway really doesn’t work here) 
These are some of my New Year resolutions. I figured I might as well get an early start. You are free to borrow and build on them!    Until the next time,   Rashmi Shastry, CMT [post_title] => Technical Insights - November 2020 [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => technical-insights-november-2020 [to_ping] => [pinged] => [post_modified] => 2020-11-09 15:53:34 [post_modified_gmt] => 2020-11-09 20:53:34 [post_content_filtered] => [post_parent] => 0 [guid] => https://cmtassociation.org/?post_type=technical_insights&p=53436 [menu_order] => 0 [post_type] => technical_insights [post_mime_type] => [comment_count] => 0 [meta_id] => 570934 [post_id] => 53436 [meta_key] => newsletter_content_2_contributor [meta_value] => a:2:{i:0;s:5:"52773";i:1;s:4:"1805";} ) [6] => stdClass Object ( [ID] => 53096 [post_author] => 3815607 [post_date] => 2020-10-02 16:40:05 [post_date_gmt] => 2020-10-02 20:40:05 [post_content] =>
Welcome, Readers, to the second edition of Technical Insights, for October 2020.
Change is Constant.
This statement is a fun oxymoron but change is not easy to keep up with. Humans have evolved exponentially since the beginning of time and this can be attributed to one very important factor-Adaptability. Since change is constant, only those who adapt, will survive. Consider this, if the stock market is a whole world of its own, all the stocks are like people in it. Stocks react much like the people around us. Some are stable, some are temperamental, some are active, and some are passive, and so on. Stocks have different personalities because they reflect their traders’ traits. Treat them as your friends and recognize their traits in order to comprehend their trends.
Understanding this universe leads to effective analysis.  Market participants take some time to build their systems and strategies in order to be on the right side of the market more often than not. Most people learn through trial and error over a considerable period. While experience is a very important aspect in the market, one cannot wait for things to happen to experience all kinds of scenarios. For that matter, one wouldn’t hope for a market to crash, just to learn how to react to it better! Therefore, it is a smart move to learn from those who have been a part of the market for longer and have spent more time honing their own skills. Just like books, human beings themselves are a source of immense knowledge!
The pandemic took over our lives for a better part of the year. It has given us time to pause and reflect on our actions and goals. These trying times are opportunities to enhance our existing skill set. A new normal is waiting for us at the horizon, and we must be prepared for it. In keeping with the idea of learning from experiences of others, the CMT Association is hosting the second edition of the Annual (now Virtual) Summit on 10 and 11 of October. Speakers from across the globe will share their views, strategies, tips and tricks, to help you befriend stocks quickly.
I have had the good fortune of listening to sessions by some of these speakers before, and I guarantee you, you are in for a treat! Various styles of trading and analysis will be showcased by individuals currently placed at the helm of their organizations: tactfully maneuvering in times of distress and sharing their ideas with other enthusiasts. This is a Technical Analyst’s Annual Extravaganza and must not be missed! What’s more, we have the Bull of Dalal Street, Rakesh Jhunjhunwala joining us as well! Hope to see you guys online at the Summit, until then, do take care of yourselves and think Technical!
Regards,
Rashmi Shastry, CMT  
Editor
[post_title] => Technical Insights, October 2020 [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => technical-insights-october-2020 [to_ping] => [pinged] => [post_modified] => 2021-04-07 10:48:01 [post_modified_gmt] => 2021-04-07 14:48:01 [post_content_filtered] => [post_parent] => 0 [guid] => https://cmtassociation.org/?post_type=technical_insights&p=53096 [menu_order] => 0 [post_type] => technical_insights [post_mime_type] => [comment_count] => 0 [meta_id] => 562451 [post_id] => 53096 [meta_key] => newsletter_content_0_contributor [meta_value] => a:1:{i:0;s:5:"52773";} ) [7] => stdClass Object ( [ID] => 52759 [post_author] => 3815607 [post_date] => 2020-09-02 17:05:21 [post_date_gmt] => 2020-09-02 21:05:21 [post_content] => Hello readers! Welcome to the first edition of the CMT India Newsletter – Technical Insights. Necessity is the mother of invention. Introspection is the mother of reinvention. So we reinvented our approach towards Life, as we knew it. What was once a scene out of a sci-fi movie, now became our reality; as countries across the globe went into lockdown to limit the impact of Covid-19. Cut to two quarters later, and survival is the only mantra. In the spirit of survival, we decided to regroup and provide market participants with high quality insights to help them navigate the risks inherent to markets these days. We were sitting on a gold mine of technical analysis talent and we resolved to make the most of our resources. The market has taken us on a roller-coaster ride over the past six months and the need for quality analysis is more telling than ever before. To help participants understand how various aspects of their markets are interlinked, we called upon our experienced charter holders to share perspectives that could help you in treading unexplored vistas. The idea is not only to introduce readers to the body of knowledge of Technical Analysis, but to also familiarize them with its heartbeat. Informed market participants know how to make their money work for them. Whether we are ‘working from home’ or ‘staying at work’, here’s a newsletter focused on technical analysis that will give you insights on application of concepts, and strategies. When big families have a meal, a buffet makes more sense than à la carte. So, when the CMT family came together we decided to present a buffet of information - something for everyone. The sections that will form a part of the newsletter are: If there is any other topic that you wish to see here, contact us and we will do our best to incorporate your suggestions. This is the beginning of an exciting new journey and we are overjoyed to share this with you! To all the volunteers, members, charter holders, the CMT Head Office in New York, and the leader of the pack – the India Office Head, Joel Pannikot: Thank you for making this dream a reality. Rashmi Shastry, CMT Editor   Disclaimer: This newsletter is for information purposes only. None of the content here is to be construed as investment advice or recommendations. The views and opinions expressed by each author is their own. [post_title] => Technical Insights, September 2020 [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => technical-insights-september-2020 [to_ping] => [pinged] => [post_modified] => 2020-09-08 13:28:42 [post_modified_gmt] => 2020-09-08 17:28:42 [post_content_filtered] => [post_parent] => 0 [guid] => https://cmtassociation.org/?post_type=technical_insights&p=52759 [menu_order] => 0 [post_type] => technical_insights [post_mime_type] => [comment_count] => 0 [meta_id] => 554076 [post_id] => 52759 [meta_key] => newsletter_content_0_contributor [meta_value] => a:1:{i:0;s:5:"52773";} ) )

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