Indian equity markets reversed from a stage of extreme fear in June 2022 to a stage of greed in August 2022.
The midcap index has rallied over 20% from the June 2022 lows. The market breadth has been strong in favour of the bulls.
As midcap stocks rally, some footwear stocks have rallied over 30% since the June lows.
We created the proprietary Equal Weighted Footwear Index (EWFI) from listed footwear stocks. These have a minimum marketcap of 10 bn (see chart below).
The EWFI consolidated between 700-815, as smart investors accumulated, and formed a base for the take-off.
The index broke out of the consolidation zone at 815 and then went on to hit a high 898.
The level of 900 is as a resistance but the bulls are strong enough to break it. This will lead to a resumption in the bullish momentum.The short-to-medium trend is bullish footwear stocks. Investors should choose the top outperforming stocks from this sector to trade on the long side.
I even highlighted this in my daily market analysis video yesterday.
On Friday, footwear stocks ended on a mixed note. Metro Brands rallied 7% while Campus Activewear surged 4%. Both these are newly listed stocks.
Meanwhile, Relaxo Footwear and Mirza International ended on a negative note.
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Brijesh Bhatia Research Analyst and expert chartist, is the editor of Alpha Wave Profits. Fully committed to his craft, Brijesh has mastered the art of making money by trading using technical analysis. Brijesh has an MBA from ICFAI and 16 years of experience in India's financial markets. He began his career on Dalal Street as commodities dealer and it wasn't long before he developed his own unique trading system. Brijesh worked on his trading system until it could be expected to deliver 5 units of return for every unit of risk.
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1 Responses to "A Momentum Breakout in Footwear Stocks"
Laxman rao
Dec 4, 2022Super