<abstract xmlns="http://www.w3.org/1999/xhtml"><p>The purpose of this study is to undertake technical analysis of selected companies included in the S&amp;P CNX Nifty 50, a leading stock market index in India. We have used the stock price data of twenty leading listed firms in India for a period from January 1, 2012 through December 31, 2017. We have applied Guppy Multiple Moving Average (GMMA), Moving Average Convergence Divergence (MACD), Stochastic Relative Strength Index (Stoch RSI) and Average Directional Index (ADX) to Heikin Ashi charts to back test and provide entry and exit points for the players in the stock market. Analysis of the price information has revealed that the GMMA and ADX are effective indicators for most of the stocks under the study but they give late signals as compared to RSI and MACD. Further, the study has shown that though RSI and MACD give early signals, yet they are risky as the number of false signals generated by them is also found out to be quite high. The study is important as the findings can be used by investors, option traders and portfolio managers to get generate profitable trading signals and obtain good risk to reward ratios.</p></abstract>

The purpose of this study is to undertake technical analysis of selected companies included in the S&P CNX Nifty 50, a leading stock market index in India. We have used the stock price data of twenty leading listed firms in India for a period from January 1, 2012 through December 31, 2017. We have applied Guppy Multiple Moving Average (GMMA), Moving Average Convergence Divergence (MACD), Stochastic Relative Strength Index (Stoch RSI) and Average Directional Index (ADX) to Heikin Ashi charts to back test and provide entry and exit points for the players in the stock market. Analysis of the price information has revealed that the GMMA and ADX are effective indicators for most of the stocks under the study but they give late signals as compared to RSI and MACD. Further, the study has shown that though RSI and MACD give early signals, yet they are risky as the number of false signals generated by them is also found out to be quite high. The study is important as the findings can be used by investors, option traders and portfolio managers to get generate profitable trading signals and obtain good risk to reward ratios.

Picking Buy-Sell Signals: A Practitioner’s Perspective on Key Technical Indicators for Selected Indian Firms

K J Somaiya Institute of Management Studies and Research

Studies in Business and Economics

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

The purpose of this study is to undertake technical analysis of selected companies included in the S&P CNX Nifty 50, a leading stock market index in India. We...

Picking Buy-Sell Signals: A Practitioner’s Perspective on Key Technical Indicators for Selected Indian Firms

Published Online: Jan 21, 2020

Page range: 205 - 219

DOI: https://doi.org/10.2478/sbe-2019-0054

Keywords
ADX, GMMA, Heikin Ashi, MACD, S&P CNX Nifty 50, RSI

© 2019 Talwar Shalini et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Picking Buy-Sell Signals: A Practitioner’s Perspective on Key Technical Indicators for Selected Indian Firms

Published Online: Jan 21, 2020

Page range: 205 - 219

DOI: https://doi.org/10.2478/sbe-2019-0054

KeywordsADX, GMMA, Heikin Ashi, MACD, S&P CNX Nifty 50, RSI

© 2019 Talwar Shalini et al., published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
ADX, GMMA, Heikin Ashi, MACD, S&P CNX Nifty 50, RSI