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Great buying opportunity?
hi everyone welcome on today's blog we are going to analyze be demolished of f m c these stocks this is a very important video if you are looking to invest in the offense e g sector would now be the great time to do it or should you just sell everything and go away that is the specific analysis that they are going to do this will be a short but are very inside full video but let me give out some very quick disclaimer point number one i'm investing in the f and c d sector don't trust me take a look at my holding off at you and now the reason i'm openly sharing this is fairly simple because i don't know loud hollow words there a lot of people who'll do analysis but they themselves in their personal life would not go and take positions on whatever they him analyzing so i do not do any of that thing yes i can be incorrect like any other investor bout the market but whatever analysis that i'm presenting i myself am following it if you like it please invest at your own behest if you don't like it please do not invest but i'm going to explain you might as well off why am i doing something or not doing something in a lot of you i mean how do you get to invest so much money in stocks indifferent other asset classes how you do it so the trick is fairly simple that i keep a good track of my money i'm frugal with my spending habits i'm good with my investing habits and i've been doing that for years and that has allowed me to build a good card to build these habits you can check out the bit were the sponsors of this video they allow you to track your money really well they allow you to spend it wisely and invest it in a more systematic manner so the links are in the description box do go and check it out with ebay promote something called a spots spaced investing which is linked to your goals to do go and check it out and let us start with today's video for three specific things that i'm going to speak about one is that i'm going to give you an overall analysis of the agency g sector from a technical standpoint second we are going to speak about the pain points or the reasons for fall in the agency these stocks what are the primary reasons and more importantly should you be worried about those reasons had him finally what you should be doing and what am i doing in this market so he'll have a brief discussion around these points but one very quick concept that i want to cover the concept of mean reversal now what i mean rivers and this is a very very important concept for you to understand to make sense of what is happening with m c d stocks so mean rivers and in simple word means that you would have seen a two hundred day moving average line i will show are you on the chart op at you and also in a minute but two hundred day moving average line is considered to be the last one year average of this dog so this will be to an extent is an indicator of me right of this is generally what does top prizes this what this line simply indicates now what you'll see that the stock price i'm highlighting this and loose for rust stock price move something like this item time it will follow two hundred day moving average it will come down and it will climb back up to this type of stuff keeps on happening so the theory of mean reversal in simple words he's this bad things that go up much higher than their two hundred day moving average line at some point they will return to their two hundred day moving average line and things that go way down we had two hundred day moving average line bill come back up to two hundred day moving average like this is a simplistic definition please don't quote me on this i'm just explaining it from a conceptual level understand now why am i talking about mean rivers and the reason is fairly simple because right now the f m p these dogs are badly beaten down so let me take you to hindustan you liver which is one of the foremost a country's stock in india and prevent this analysis so here you will see this two hundred day moving average line this is indicated i saw the black line is two hundred day moving average and this is currently the price so essentially the two hundred day moving average indicates that the price should have been roughly twenty four thirteen and the stock is trading at roughly twenty three hundred you the difference between these two things now what does this mean and what is the implication that has for you so the implication is fairly simple that if you're an investor then you just simply need to answer one simple thing that is mean a reversal going to happen in this industry or is it not going to happen in this industry something fundamentally changed completely something fundamentally has changed completely that you know the f m d g margins have been brought down all these companies are going through a very high did situations are these companies have lost their pricing power then yes you can make an argument that mean reversal is not going to have had such a situation played out in the past yes the situation paid out in twenty eight twenty nine with housing finance companies there was massive debt burden on entire industry the entire industry collapsed and it has not been able to come up up until now so that was a systemic issue for the only thing that you need to be worried about right now is that is the events leading industry going through a similar type of a crisis or not if not bid mean reversal will happen and all the assembly these stocks are going to go on and oh johnny now let me also share very quick technical around it so as to make my point even clearer so you can see that this is be nifty chart and if you take a look at this chart the nifty from its recent high has been down by roughly five point zero four percent so this is the current level of nifty from its top and it has
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