Wipro - Jul 26th to Aug 3rd '12 - EOD Analysis

Wipro post results went down from 350 levels to 327 due to flat guidance provided by the management team which indicates that the company does not have a steady outlook on the road ahead performance, with volume growth just below 1% whereas TCS showing 5% 

Technically Wipro looks to have bottomed out by analyzing with the help of Elliot Wave theory

Elliot wave theory suggests that a stock goes through 5 waves up or down. Last couple of days Wipro has been sliding down and finally wave 5 ended at 327

Elliot Wave analysis

Around July 4 wave 3 started and post which a retracement of wave 4 occurred and further to results on Jul 24th we see wave 5 ending at 327.35 with a DOJI sign appearing after that on Jul 26th

Candlestick Pattern

After completion of wave 5, on Jul 26th Wipro made a DOJI sign on charts, this usually means that sooner a very big movement may occur both ways (i.e. on upside or downside). However looking at the momentum indicators one can boldly register a point that this stock should now climb up with a target of 350.

Fibonacci retracement level

Going through charts, by connecting wave 2 high of 409.75 & wave 5 low of 327.35, we can say that at 23.6% level stock will reach 347, hence the stock can easily move up to 347 - 350 levels in the coming trading sessions

Elliot wave analysis & Fibonacci retracement go hand in hand and suggest that anytime an upmove is possible

Moving Averages

By seeing exponential moving averages 12 & 26 days one can say that the cross over that happened on Jul 4th is an indication that investors/huge institutions have already started to speculate on a negative side about the stock and on Jul 24th it so happened that guidance was not delivered according to street's expectations

Momentum & Volume Indicators

RSI, Williams%R and Full Stochastics indicator are all in oversold level and are positively looking for an upward move. TRIX should sooner change after the deep fall that has happened. Similarly force index which is a volume indicator has started to move up slightly

Summary

1. Wave 5 completed, and a fresh upmove may come in ant time

2. DOJI pattern followed by momentum & volume indicators in oversold zone indicates movement upward

3. Fibonacci retracement level @ 23.6% shows 347 as stock price

Overall buy Wipro at current levels and target 345 to 350 in next couple of trading sessions with a SL at 327.4