SMT HIRABEN NANAVATI INSTITUTE OF MANAGEMENT AND RESEARCH FOR WOMEN

KARVENAGER, PUNE- 411052

CERTIFICATE COURSE ON FUNDAMENTAL AND TECHNICAL ANALYSIS

PROJECT REPORT
SMT. HIRABEN NANAVATI INSTITUTE OF MANAGEMENT
AND RESEARCH FOR WOMEN
KARVENAGER, PUNE-52

CERTIFICATE COURSE
ON
FUNDAMENTAL AND TECHNICAL ANALYSIS

Project report

submitted by
Name Gayatri Suresh Sonsare
Roll No. 2k231058
Submission date 15/10/2024

Marks

Evaluator’s
signature
Q1.
Morning Star
Theory: The Morning Star is a three-candle pattern that typically forms at the end of a
downtrend and signals a potential reversal to the upside. It includes:
First Candle: A large bearish candle, indicating the continuation of the downtrend.
Second Candle: A small-bodied candle (indecision), often referred to as a "star." It can be
either bearish or bullish, showing the market is hesitating.
Third Candle: A large bullish candle that closes well above the midpoint of the second candle,
confirming the reversal.
Practical Example: I identified this pattern in HDFC Bank on 18 march 2023, where after a
downtrend, a Morning Star formed, indicating a trend reversal to an uptrend. The reversal
was confirmed with increased buying volume. The reversal was confirmed by a 25% increase
in trading volume.
Evening Star
Theory: The Evening Star is the opposite of the Morning Star and signals a potential reversal
from an uptrend to a downtrend. It consists of:
First Candle: A large bullish candle, continuing the uptrend.
Second Candle: A small-bodied candle that indicates indecision in the market.
Third Candle: A large bearish candle that closes below the midpoint of the first bullish candle,
confirming the trend reversal.

Practical Example: I found this pattern in HDFC Bank on 25 Sep 2024, where the market
transitioned from an uptrend to a downtrend after the Evening Star formed. This reversal was
confirmed by declining volume.
Engulfing Pattern (Bullish)
Theory: The Engulfing pattern is a two-candle reversal pattern. It can either be bullish or
bearish:
Bullish Engulfing: Occurs at the end of a downtrend. The first candle is bearish, and the
second candle is a large bullish one that completely engulfs the body of the previous candle,
indicating a potential upward reversal.
Bearish Engulfing: Occurs at the end of an uptrend. The first candle is bullish, and the second
is a large bearish candle that completely engulfs the body of the previous bullish candle,
indicating a potential downward reversal.

Practical Example: I spotted a Bullish Engulfing pattern in Reliance Industries on 25 sep 2023,
indicating a reversal from a downtrend to an uptrend. This was validated by a strong bullish
candle that overtook the previous bearish one, with rising volume confirming the shift.
Piercing Pattern (Bullish)
Theory: The Piercing pattern is another two-candle reversal pattern:

Bullish Piercing: Appears at the bottom of a downtrend. The first candle is bearish, but the
second candle opens lower and closes more than halfway up the body of the previous candle,
suggesting a potential reversal to the upside.
Bearish Piercing (Dark Cloud Cover): Appears at the top of an uptrend. The first candle is
bullish, but the second candle opens higher and closes more than halfway down the body of
the previous candle, indicating a potential reversal to the downside.

Practical Example: In Bharat Petroleum, I identified a Bullish Piercing pattern on 5 Apr 2024.
The second bullish candle closed significantly higher than the midpoint of the previous
bearish candle, indicating a shift from bearish sentiment to bullish, confirmed by higher
buying volume.
Q2.

EMA Lines and Candlesticks: Plot the 21, 63, 100, and 200 EMAs in 3 types of time frame using
Heikin Ashi candlestick pattern.
Key EMAs Used:
 21 EMA (Blue line): Short-term trend indicator
 63 EMA (Red line): Medium-term trend indicator
 100 EMA (Yellow line): Longer-term trend indicator
 200 EMA (Black line): Very long-term trend indicator

Analysis: Daily Timeframe Analysis for TCS (Tata

Consultancy Services)
In this daily timeframe chart for TCS, I have plotted the 21 EMA (blue line), 63 EMA (red line),
100 EMA (yellow line), and 200 EMA (black line). The chart shows clear crossover signals at
two distinct points, which I will explain below:

1. First Entry Point (Left Circle) – Bullish Signal:

 21 EMA (Blue) crosses above the 63 EMA (Red) and other longer-term EMAs (100
EMA and 200 EMA) around the first highlighted circle.
 This crossover indicates a bullish signal in the daily timeframe, suggesting a buy entry
as the shorter-term EMA (21) is gaining strength and moving above the longer-term
EMAs.
 The price action reflects this upward momentum, as you can see a strong price spike
following this crossover. Traders would typically enter the position here, expecting a
short-term uptrend.
2. Second Exit Point (Right Circle) – Bearish Signal:
 In the second highlighted circle, the 21 EMA (Blue) crosses below the 63 EMA (Red)
and other longer-term EMAs, indicating a bearish signal.
 This crossover suggests a sell signal as the short-term EMA (21) starts moving below
the longer-term EMAs, indicating a loss of momentum and a potential downtrend.
You can see a decline in price following this crossover, making it a good point to exit
the position.

Summary of Analysis:
 The first crossover on the left of the chart marks a strong buy signal when the 21
EMA crossed above the 63 EMA, followed by price appreciation.
 The second crossover on the right side marks a clear sell signal, as the 21 EMA fell
below the 63 EMA and the other EMAs, indicating a downward trend.
 This chart is an excellent example of using the EMA crossover strategy to time entries
and exits in a short-term trade on the daily timeframe.
By following these signals, traders can take advantage of momentum shifts, with clear entry
and exit points based on the price action and EMA behavior.
Daily Timeframe Analysis of TCS – EMA Crossover
Strategy
Weekly Timeframe Analysis of Infosys (INFY) – EMA
Crossover Strategy

In this daily timeframe chart for INFY, I have plotted the 21 EMA (blue line), 63 EMA (red
line), 100 EMA (yellow line), and 200 EMA (black line). The chart shows clear crossover
signals at two distinct points, which I will explain below:

1 Entry Point:
The first circle highlights a bullish EMA crossover. At this point, the 21 EMA (blue)
crosses above the 63 EMA (red) and the 100 EMA (yellow), indicating a strong bullish
trend. This is an ideal point to enter a long position, as it suggests that the stock is
likely to continue its upward momentum. The price action after the crossover
confirms this with a significant upward rally.
2 Exit Point:
The second circle shows the opposite—a bearish crossover. The 21 EMA (blue)
crosses below both the 63 EMA (red) and 100 EMA (yellow), indicating a weakening
trend and a potential reversal. This would be an ideal point to exit the trade to lock in
profits, as the stock enters a downtrend shortly after this crossover.
3 Additional Observations:
The 200 EMA (black), which reflects the long-term trend, remains flat and below all
other EMAs. This suggests that while short- and medium-term momentum may
change, the overall long-term trend could still be intact.
The sharp fall in the price following the second crossover confirms the importance of
paying attention to the EMA crossovers in a trending market. Exiting after the second
crossover would have saved capital as the stock quickly loses value.
4 Conclusion:
Entry: At the bullish crossover (when the 21 EMA crossed above the 63 EMA and 100
EMA).
Exit: At the bearish crossover (when the 21 EMA crossed below the 63 EMA and 100
EMA).
These crossovers are significant points that align with typical entry and exit signals in
an EMA crossover strategy.
Weekly Timeframe Analysis Chart of Infosys (INFY) –
EMA Crossover Strategy
Britannia Industries Monthly Timeframe Analysis – EMA
Crossover Strategy

1. First Entry Point (Left Circle) – Bullish Signal:

 21 EMA (Blue) crosses above the 63 EMA (Red), indicating that the short-term trend is
gaining strength.
 As the 21 EMA stays above the 100 and 200 EMAs, this suggests a strong bullish
momentum, suitable for long-term investors to buy or enter a position.
 After this crossover, prices move upwards steadily, validating the bullish signal. This is a
good opportunity to ride the trend for the long term, as the price continues its upward
momentum.

2. Second Exit Point (Right Circle) – Bearish Signal:

 In the second highlighted circle, the 21 EMA (Blue) crosses below the 63 EMA (Red) and
continues to break below the 100 EMA and 200 EMA.
 This bearish crossover signals a loss of upward momentum and indicates that the trend is
reversing to the downside.
 Following this crossover, prices begin to decline, confirming the bearish outlook. This is an
ideal exit point, indicating investors to close their long positions or avoid new buy entries.

Summary of Analysis:
 First Crossover (Left Circle):
o The 21 EMA crossing above the 63 EMA marks a bullish entry point, indicating
that the stock is likely to move higher.
o Investors who entered at this point benefited from the uptrend.
 Second Crossover (Right Circle):
o The 21 EMA crossing below the 63 EMA indicates a sell signal, warning of a
potential downtrend.
o Exiting at this point would have saved traders from further losses, as prices
continued to decline.

Conclusion:
This EMA crossover strategy on the monthly timeframe helps investors focus on long-term trend
shifts. By following the signals:
1. Entering during a bullish crossover allows them to capture gains during upward
momentum.
2. Exiting during a bearish crossover helps avoid prolonged downtrends, preserving profits
or minimizing losses.
This chart illustrates how the 21-63-100-200 EMA crossovers can offer clear entry and exit points
for investors with a long-term horizon.
Britannia Industries Monthly Timeframe Analysis Chart –
EMA Crossover Strategy
Head and Shoulders Analysis for Reliance Industries in
Daily Timeframe
 Pattern Explanation:
The Head and Shoulders is a bearish reversal pattern that consists of:
1. Left Shoulder: Initial rise followed by a peak, then a retracement.
2. Head: A higher peak forms, followed by a decline.
3. Right Shoulder: A smaller peak near the left shoulder’s height, followed by a
breakdown.
 Observed on Chart:
o The left shoulder forms during the initial price rise.
o The head represents the sharp increase with the highest peak near ₹3,070.
o The right shoulder follows, unable to reach the peak of the head, indicating
weakening momentum.
o Neckline: The blue horizontal line acts as the neckline (support level). Once
price breaks below this level, the downtrend accelerates.

Entry, Target, and Stop-loss Recommendations

 Entry Point:
o Enter a short position once the price closes below the neckline, confirming
the breakdown.
 Target Price:
o Target price is typically the height from the head to the neckline subtracted
from the breakdown point.
o In this case:
 Head peak: ₹3,070
 Neckline: ₹3,040
 Height = 3,070 - 3,040 = ₹30
 Target Price = 3,040 - 30 = ₹3,010
 Stop-Loss:
o Place a stop-loss slightly above the right shoulder, around ₹3,050, to limit
losses if the pattern fails.

Outcome in Chart:

 As indicated by the sharp decline, the price continued to fall after breaking the
neckline, confirming the bearish signal. The downtrend pushes the stock towards
₹2,980, aligning with the measured move target.
Head and Sholder Analysis for Reliance Industries in
Daily Timeframe Chart.
Cup & Handle Analysis for TATA Motors In Daily
Timeframe.

1. Cup Formation:
o Start of the Cup: The downtrend ends, and the price starts curving upward
around ₹1059.
o Lowest Point of the Cup: The price reaches its bottom at around ₹1044.
o End of the Cup (Resistance): The cup ends at around ₹1074, which is the
resistance level, where the price struggles before the handle forms.
2. Handle Formation:
o The price consolidates downward slightly, with the lowest point of the handle
around ₹1062 before rallying back towards the resistance level of ₹1074.
3. Breakout:
o The price breaks out above the resistance level of ₹1074 and sharply rises to a
high of ₹1092.

Measured Move Calculation:

To estimate the potential price target based on the Cup and Handle pattern:

1. Cup Depth:
o The difference between the resistance (top of the cup) and the lowest point
(bottom of the cup):
o ₹1074 (Resistance) - ₹1044 (Bottom) = ₹30
2. Breakout Target:
o Adding the depth of the cup to the breakout point (the resistance level):
o ₹1074 + ₹30 = ₹1104

Conclusion with Price Levels:

 Cup Low: ₹1044

 Cup High (Resistance): ₹1074
 Handle Low: ₹1062
 Breakout Level: ₹1074
 Price Target: ₹1104 (projected after the breakout)

This projection suggests that after the breakout, the price of Tata Motors could potentially
reach ₹1104 based on the cup and handle pattern. However, always consider additional
factors like market conditions and volume before making trading decisions.
Cup & Handle Analysis for TATA Motors In Daily
Timeframe Chart.
Flag Pattern Analysis for Adani Enterprises on Daily
Timeframe.
1. Initial Rally (Pole Formation):
o The stock price started with a sharp upward movement, creating the "pole" of
the flag.
o The price moved from ₹2940 to around ₹3040, indicating a strong bullish
momentum.
2. Flag Consolidation:
o After the initial rally, the stock entered a period of consolidation, forming a
flag shape.
o The flag is a slight downward-sloping rectangle, indicating a temporary pause
in the bullish trend.
o The price range during this consolidation is roughly between ₹3000 (support)
and ₹3030 (resistance).
3. Breakout:
o The price broke out of the consolidation (flag) at ₹3030, indicating the
continuation of the upward trend.
o After the breakout, the price surged to around ₹3080, resuming its bullish
movement.

Conclusion:

 Flag Pole Start: ₹2940

 Flag Pole End: ₹3040 (Pole height = ₹100)
 Consolidation Range: ₹3000 to ₹3030
 Breakout Level: ₹3030
 Post-Breakout Movement: ₹3080 (Target reached after breakout)

The Flag Pattern suggests a bullish continuation after a breakout, and the price movement
aligns with this expectation.
Flag Pattern Analysis for Adani Enterprises Chart on
Daily Timeframe.
Inverse Head and Shoulder Analysis of Cummins India in
Daily Timeframe.
1. Left Shoulder:
o The price dips to around ₹3768.50 and then slightly rises.
o This forms the first part of the pattern as the left shoulder.
2. Head:
o The price drops further, forming the "head" of the pattern. The lowest point is
around ₹3756.50.
o This is the lowest price in the entire pattern and signifies the exhaustion of the
bearish move.
3. Right Shoulder:
o After hitting the low, the price rises and dips again, but this dip is not as deep
as the head, marking the right shoulder.
o The price during this dip is around ₹3768.50, similar to the left shoulder level.
4. Neckline:
o The horizontal line at approximately ₹3793 acts as the "neckline" of the
pattern. This is the key resistance level that needs to be broken for
confirmation of the reversal.
5. Breakout:
o The breakout occurs when the price crosses above the neckline at ₹3793. This
signals a bullish reversal.
o The price then rises sharply to ₹3878.50, confirming the pattern.

Key Levels:

 Left Shoulder Low: ₹3768.50

 Head Low: ₹3756.50
 Right Shoulder Low: ₹3768.50
 Neckline (Breakout Level): ₹3793
 Post-Breakout High: ₹3878.50

Conclusion:

The Inverse Head and Shoulders pattern seen in Cummins India Ltd. suggests a bullish
reversal after a downtrend. The breakout above the neckline confirms the upward momentum,
with the price rising from ₹3793 to ₹3878.50. This pattern is often followed by a further price
rally, indicating bullish strength in the stock.
Inverse Head and Shoulder Analysis of Cummins India
in Daily Timeframe Chart.
Q4.
1. Price to Earnings (PE) ratio is below 40
2. Return on Capital Employed (ROCE) is more than 15%
3. Price to Earnings Growth (PEG) is below 5
4. Interest Coverage Ratio is more than 3
5. Market Capitalization is above ₹50,000 crore

Using these filters, I was able to screen companies that fit the specified criteria. Below are the
steps I followed:

Steps:
1. Choose a Stock Screener:
o You can use a platform such as Screener.in, Moneycontrol, Tickertape, or
TradingView.
o For this example, we’ll use Screener.in as it's free and popular among investors.
2. Create an Account (if required):
o Sign in or create an account to save the filters and results.
3. Navigate to the Screener:
o Go to the "Screener" section on the website.
4. Set Filters: Enter the following parameters in the screener:
o PE Ratio < 40:
 Select "Price to Earnings Ratio (P/E)" and set the maximum value to 40.
o Return on Capital Employed (ROCE) > 15%:
 Search for "ROCE" or "Return on Capital Employed" and set the
minimum value to 15%.
o Price to Earnings Growth (PEG) < 5:
 Find the "PEG Ratio" and set the maximum value to 5.
o Interest Coverage Ratio > 3:
 Look for "Interest Coverage Ratio" and set the minimum to 3.
o Market Capitalization > ₹50,000 Cr:
 Use "Market Cap" or "Market Capitalization" and set the minimum to
50,000 Cr.
5. Apply Filters:
o Once you’ve entered all the criteria, click "Apply" or "Search" to filter the list of
companies.
6. Review the List:
o The screener will provide a list of companies that satisfy the above parameters.
Review the results to ensure they meet the criteria.
7. Print the Results:
o Click on "Export to Excel" or "Print" (if available on the screener).
o If there's no direct print option, you can take a screenshot or export the list to
Excel, then print the document.
THANKYOU