technical analysis is the study of a stock

8/3/2019 Technical Analysis is the Study of a Stock

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A

Report

On

Technical analysis

Of

Submited to:- submitted by:-

Dr. kapil Gupta Saloni Sharma

Roll no :- 104522248380

Global institute ofmanagement

Amritsar


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Meaning of technical analysis .

Technical analysis is the study of a stock, or the market as a whole, strictly by using the price

and volume history of a stock. Technical analysis uses little or no information about the actual

business behind the stock. The common belief is that a stock price represents all known

information about a stock. Technical analysis is an alternative to fundamental analysis.

A method of evaluating securities by relying on the assumption that market data, such as charts

of price, volume, and open interest, can help predict future (usually short-term) market trends.

Unlike fundamental analysis, the intrinsic value of the security is not considered. Technical

analysts believe that they can accurately predict the future price of a stock by looking at its

historical prices and other trading variables. Technical analysis assumes that market psychology

influences trading in a way that enables predicting when a stock will rise or fall. For that reason,

many technical analysts are also market timers, who believe that technical analysis can be

applied just as easily to the market as a whole as to an individual stock.

1) Difference between technical analysis and fundamental alaysis.FUNDAMENTAL ANALYSIS T ECHNICAL ANALYSIS

Fundamental analysis is a method ofevaluating securities by attempting to

measure the intrinsic value of a stock.

Technical analysts do not attempt to measurea security's intrinsic value but instead use

stock charts to identify patterns and trendsthat may suggest what a stock will do in the

future.Fundamental analysts study everything

from the overall economy and industryconditions to the financial condition and

management of companies.

Technical traders, on the other hand, believe

there is no reason to analyze a company'sfundamentals because these are all accounted

for in the stock's price. Technicians believethat all the information they need about a

stock can be found in its charts.

Fundamental analysis focuses on financial

ratios and numbers such as debt, EPS, cashflow forecasts, etc

Technical analysis focuses on historical price

movements to determine possible short termor long term moves to come.

Fundamental analysis takes a relativelylong-term approach to analyzing the marketcompared to technical analysis.

Technical analysis can be used on atimeframe of weeks, days or even minutes,fundamental analysis often looks at data over

a number of years.

Fundamentalists are of opinion thet supplyand demand for stocks depend on the

underlying factors. The forecasts of supplyand demand depend on various factors.

Technicians opine that they can forecastsupply and demand by studying the prices and

volume of trading.


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2) Difference between technical analysis and efficient market hypothesis.


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Company profile

Date of establishment :- 1933

Headquarters :- Mumbai, India

Revenue :- 4275.18 ( USD in Millions)

Management Details :- Chairperson - Harish Manwani

MD - Nitin Paranjpe, Directors - A Narayan, Ashok K Gupta, C K Prahalad,

D S Parekh, D Sundaram, Dhaval Buch, Douglas Baillie, Gopal Vittal, Harish

Manwani, Nitin Paranjpe, Pradeep Banerjee, RA Mashelkar, S Ramadorai.

Business Operation :- Household & Personal Products

Type :- Public company

Industry :- Fast Moving Consumer Goods

HUL also won The Top Companies for Leaders 2007 By fortune

Products : tea, soap, detergents

Employees : 41,000

Parent : Unilever

Website : www.hll.com


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Product line of the company

1. Food brands 2. Home care brands

Brooke Bond 3 Roses Active Wheel

Annapurna Cif

Red Label Comfort

Brooke Bond Taaza Domex

Brooke Bond Taj Mahal Rin

Bru Sunlight

Kissan Surf excel

Knorr Vim

Kwality Walls

Lipton

Modern

Brooke Bond Sehatmand

3. Personal care brandsAviance Dove Liril 2000

Axe Fair & Lovely Lux

Hamam Lakme Pears

LEVERAyush Therapy Breeze Pepsodent

Clinic Plus Lifebuoy Rexona


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Past milestones

I

n the summer of 1888, visitors to the Kolkata harbour noticed crates full of Sunlight soapbars, embossed with the words "Made in England by Lever Brothers". With it, began an era of

marketing branded Fast Moving Consumer Goods (FMCG).

Soon after followed Lifebuoy in 1895 and other famous brands like Pears, Lux and Vim.

Vanaspati was launched in 1918 and the famous Dalda brand came to the market in 1937.

In 1931, Unilever set up its first Indian subsidiary, Hindustan Vanaspati Manufacturing

Company, followed by Lever Brothers India Limited (1933) and United Traders Limited

(1935).

The erstwhile Brooke Bond's presence in India dates back to 1900. By 1903, the company

had launched Red Label tea in the country. In 1912, Brooke Bond & Co. India Limited was

formed. Brooke Bond joined the Unilever fold in 1984 through an international acquisition.

HUL formed a 50:50 joint venture with the US-based Kimberly Clark Corporation in 1994,

Kimberly-Clark Lever Ltd, which markets Huggies Diapers and Kotex Sanitary Pads. HUL

has also set up a subsidiary in Nepal, Unilever Nepal Limited (UNL), and its factory

represents the largest manufacturing investment in the Himalayan kingdom. The UNL

factory manufactures HUL's products like Soaps, Detergents and Personal Products both for

the domestic market and exports to India.

The 1990s also witnessed a string of crucial mergers, acquisitions and alliances on the

Foodsand Beverages front. In 1992, the erstwhile Brooke Bond acquired Kothari General

Foods,with significant interests in Instant Coffee. In 1993, it acquired the Kissan business

from the UB Group and the Dollops Icecream business from Cadbury India.

Finally, BBLIL merged with HUL, with effect from January 1, 1996. The internal

restructuring culminated in the merger of Pond's (India) Limited (PIL) with HUL in 1998.


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HLL Receives Largest Wealth Creator Award

Mumbai: Hindustan Lever Limited (HLL) has received the Motilal Oswal Largest Wealth

Creator Award for the period 1996-2001. HLLs Finance Director, Mr. D. Sundaram, receivedthe award on behalf of the company at a function here today. This is the 5th time that HLL has

been conferred with this distinction.

HLL has improved its ROCE from 53% in 1996 to 65% in 2000, achieved through growth,margin improvement and capital productivity. HLL is on the right track towards providing long

term value to shareholders. Even in the challenging market conditions of the last few years, HLLhas continued profitable growth while conserving capital. This is reflected in the companys

negative working capital and higher quantum of cash released from operations, Mr. Sundaramsaid while accepting the award.

For the 9 month period ended 30th September 2001, HLLs Net Sales were Rs.8208.98 crores

(+3.2%). Profit After Tax was Rs.1030.97 crores (+ 18.2%), while Net Profit was Rs.1204.93

crores (+ 36.8%).

Listing history of the company

1) Bombay stock exchange2) National stock exchange3)


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Historical trend of return of the stock

Historical trend of return of the stock from 01-01-2000 to 31-03-2011

Date Closing price average3-Jan-11 313.15

4-Jan-11 320.9

5-Jan-11 325.7 318.71

6-Jan-11 320.75 317.88

7-Jan-11 313.05 315.29

10-Jan-11 309 311.13

11-Jan-11 307.95 307.42

12-Jan-11 304.9 305.32

13-Jan-11 302.2 303.85

14-Jan-11

302.55

302.6317-Jan-11 301.65 301.58

18-Jan-11 301.85 301.12

19-Jan-11 299.65 300.25

20-Jan-11 299.9 299.51

21-Jan-11 298.2 295.52

24-Jan-11 297.95 289.73

25-Jan-11 281.9 284.14

27-Jan-11 270.7 278.73

28-Jan-11 271.95 273.07

31-Jan-11 271.15

271.611-Feb-11 269.65 273.26

2-Feb-11 274.6 273.46

3-Feb-11 278.95 274.1

4-Feb-11 272.95 274.84

7-Feb-11 274.35 275.2

8-Feb-11 273.35 273.94

9-Feb-11 276.4 273.18

10-Feb-11 272.65 272.94

11-Feb-11 269.15 272.9

14-Feb-11 273.15 272.8

15-Feb-11 273.15 273.06

16-Feb-11 275.9 275.11

17-Feb-11 273.95 276.54

18-Feb-11 279.4 277.97

21-Feb-11 280.3 278.81

22-Feb-11 280.3 280.04

23-Feb-11 280.1 280.22


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24-Feb-11 280.1 280.56

25-Feb-11 280.3 281.99

28-Feb-11 282 284.13

1-Mar-11 287.45 285.69

3-Mar-11 290.8 285.9

4-Mar-11 287.9 285.857-Mar-11 281.35 284.3

8-Mar-11 281.75 281.47

9-Mar-11 279.7 279.36

10-Mar-11 276.65 278.71

11-Mar-11 277.35 277.31

14-Mar-11 278.1 275.64

15-Mar-11 274.75 274.45

16-Mar-11 271.35 272.78

17-Mar-11 270.7 270.39

18-Mar-11 269 268.9821-Mar-11 266.15 268.64

22-Mar-11 267.7 268.32

23-Mar-11 269.65 268.78

24-Mar-11 269.1 270.89

25-Mar-11 271.3 272.89

28-Mar-11 276.7 274.57

29-Mar-11 277.7 278.17

30-Mar-11 278.05 280.7

31-Mar-11 287.1 281.29

1-Apr-11 283.95

280.824-Apr-11 279.65 280.65

5-Apr-11 275.35 278.43

6-Apr-11 277.2 277.05

7-Apr-11 276 275.85

8-Apr-11 277.05 277.1

11-Apr-11 273.65 276.67

13-Apr-11 281.6 277.7

15-Apr-11 275.05 277.7

18-Apr-11 281.15 279.79

19-Apr-11 277.05 281.22

20-Apr-11 284.1 283.94

21-Apr-11 288.75 284.43

25-Apr-11 288.65 285.72

26-Apr-11 283.6 284.76

27-Apr-11 283.5 284.05

28-Apr-11 279.3 282.53

29-Apr-11 285.2 280.34


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2-May-11 281.05 278.66

3-May-11 272.65 276.31

4-May-11 275.1 274.45

5-May-11 267.55 275.19

6-May-11 275.9 280.11

9-May-11 284.75 285.1310-May-11 297.25 291.9

11-May-11 300.2 298.05

12-May-11 301.4 301.97

13-May-11 306.65 304.31

16-May-11 304.35 306.08

17-May-11 308.95 307.72

18-May-11 309.05 308.43

19-May-11 309.6 308.36

20-May-11 310.2 307.02

23-May-11 304 305.2124-May-11 302.25 305.01

25-May-11 300 303.36

26-May-11 308.6 303.12

27-May-11 301.95 303.58

30-May-11 302.8 305.67

31-May-11 304.55 308.1

1-Jun-11 310.45 311.42

2-Jun-11 320.75 313.85

3-Jun-11 318.55 314.69

6-Jun-11 314.95

315.287-Jun-11 308.75 313.64

8-Jun-11 313.4 312.22

9-Jun-11 312.55 312.02

10-Jun-11 311.45 313.34

13-Jun-11 313.95 314.01

14-Jun-11 315.35 315.68

15-Jun-11 316.75 317.57

16-Jun-11 320.9 319.29

17-Jun-11 320.9 320.69

20-Jun-11 322.55 319.49

21-Jun-11 322.35 318.83

22-Jun-11 310.75 319.52

23-Jun-11 317.6 319.7

24-Jun-11 324.35 319.95

27-Jun-11 323.45 324.36

28-Jun-11 323.6 329.57

29-Jun-11 332.8 332.05


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30-Jun-11 343.65 334.65

1-Jul-11 336.75 336.49

4-Jul-11 336.45 335.88

5-Jul-11 332.8 334.3

6-Jul-11 329.75 333.64

7-Jul-11 335.75 332.758-Jul-11 333.45 332.78

11-Jul-11 332 333.1

12-Jul-11 332.95 332.41

13-Jul-11 331.35 331.67

14-Jul-11 332.3 331.89

15-Jul-11 329.75 331.47

18-Jul-11 333.1 331.57

19-Jul-11 330.85 331.86

20-Jul-11 331.85 332.65

21-Jul-11 333.75 332.2722-Jul-11 333.7 331.59

25-Jul-11 331.2 330.42

26-Jul-11 327.45 328.24

27-Jul-11 326 326.3

28-Jul-11 322.85 324.65

29-Jul-11 324 323.91

1-Aug-11 322.95 323.11

2-Aug-11 323.75 322.38

3-Aug-11 322 321.35

4-Aug-11 319.2

320.75-Aug-11 318.85 319.84

8-Aug-11 319.7 318.7

9-Aug-11 319.45 317.97

10-Aug-11 316.3 317.21

11-Aug-11 315.55 315.36

12-Aug-11 315.05 314.75

16-Aug-11 310.45 314.85

17-Aug-11 316.4 314.88

18-Aug-11 316.8 314.5

19-Aug-11 315.7 316.04

22-Aug-11 313.15 316.7

23-Aug-11 318.15 317.4

24-Aug-11 319.7 318.19

25-Aug-11 320.3 319.56

26-Aug-11 319.65 320.01

29-Aug-11 320 320.07

30-Aug-11 320.4 319.98


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2-Sep-11 320 320.05

5-Sep-11 319.85 320.15

6-Sep-11 320 321.02

7-Sep-11 320.5 323.65

8-Sep-11 324.75 328.88

9-Sep-11 333.15 333.1512-Sep-11 346 339.57

13-Sep-11 341.35 344.47

14-Sep-11 352.6 345.71

15-Sep-11 349.25 344.08

16-Sep-11 339.35 344.41

19-Sep-11 337.85 341.64

20-Sep-11 343 338.17

21-Sep-11 338.75 336.53

22-Sep-11 331.9 334.74

23-Sep-11 331.15 333.926-Sep-11 328.9 333.1

27-Sep-11 338.8 335.48

28-Sep-11 334.75 337.37

29-Sep-11 343.8 338.42

30-Sep-11 340.6 335.91

3-Oct-11 334.15 333.34

4-Oct-11 326.25 330.45

5-Oct-11 321.9 328.56

7-Oct-11 329.35 326.89

10-Oct-11 331.15

327.5111-Oct-11 325.8 328.48

12-Oct-11 329.35 328.9

13-Oct-11 326.75 262.67

14-Oct-11 331.45 197.51


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Table 1.2 calculation of five-day Moving average for hindustan unilever

0

50

100

150

200

250

300

350

400

1 815

22

29

36

43

50

57

64

71

78

85

92

99

106

113

120

127

134

141

148

155

162

169

176

183

190

closing price average


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Historical trend of return of the stock

Historical trend of return from 03-01-2000 to 31-03-2011

Date Closing price Averge

3-Jan-00 2307.55 0

29-Dec-00 206.55 106.55

31-Dec-01 222.95 122.95

31-Dec-02 181.7 81.7

31-Dec-03 204.45 104.45

31-Dec-04 143.4 43.4

30-Dec-05 197.2 97.2

29-Dec-06 216.4 116.4

31-Dec-07 213.7 113.731-Dec-08 250.3 150.3

31-Dec-09 264.8 164.8

31-Dec-10 312.9 212.9

31-Mar-11 287.1 187.1

*pt-pt-1/pt-1*100


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Moving averages

Logic for selecting technical analysis tool :- To study the movement of the market as well as the

individual scripprice.

Application of technical tool :- The moving average is used to identify long term trend.

Technical call :- Investors should sell the stock because the price of the stock penetrates the stock

market from above , it generates sell signal. Downward penetration of the rising average indicates the

possibility of a further fall so it is better to sell the stock at this stage.

0

500

1000

1500

2000

2500

1-

Jan

-00

1-

Ju

l-00

1-

Jan

-01

1-

Ju

l-01

1-

Jan

-02

1-

Ju

l-02

1-

Jan

-03

1-

Ju

l-03

1-

Jan

-04

1-

Ju

l-04

1-

Jan

-05

1-

Ju

l-05

1-

Jan

-06

1-

Ju

l-06

1-

Jan

-07

1-

Ju

l-07

1-

Jan

-08

1-

Ju

l-08

1-

Jan

-09

1-

Ju

l-09

1-

Jan

-10

1-

Ju

l-10

1-

Jan

-11

Moving average

Closing price averge


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Bibliography

Books

Punithavathy pandian

Websites

www.hul.co.on

http://www.wikinvest.com/wiki/Hindustan_Unilever_%28HUL-BY%29

http://www.hul.co.in/mediacentre/?WT.GNAV=Media_centre

technical analysis is the study of a stock

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