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What is driving Orchid pharma share price hitting non-stop upper circuit?

What is driving Orchid pharma share price hitting non-stop upper circuit? Orchid pharma Ltd share has been in the news and buzzing a lot nowadays because of hitting back to back upper circuit of 5% everyday. But before luring and thinking to jump buying this share, let& #…

Quick steps to handpick fundamentally strong stocks for swing trading!
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I have been studying about the stock market since last 2 years back, and I have been reading hell lot of articles about investing and trading, watching youtube videos, reading bestselling books, studying daily charts of 100s of stocks daily at evening just to find out I understood very small part of overall stock market universe, the more I digged the more it became deeper and it was endless!

As the time passed, I noticed many stocks touching life time high, many stocks giving multiple hundred percent returns, most of them were less known in market. My focus started tracking these stocks, they were most likely micro and small cap and few from midcap segment.

There are many ways to identify and recognise these surging stocks, like- using screeners, money control website, tradingview, among few most popular. But to recognise the opportunity requires basic understanding of analysing the stocks. Let’s understand what is Fundamental analysis and technical analysis before jumping on ways to search and handpick swing trade!

Fundamental analysis- Analysing a stock to assess if a stock is worth investing for long term by looking it’s company’s annual report, balance sheet, overall growth, management quality, past track records, financial ratios, economical, political, governmental and global factors.

Technical analysis– Also known as Trend analysis, It is studying price chart and trend of a particular stock. In most cases a price chart reflects a company’s over all fundamentals, and any developments, any material news in advance as market discounts everything and stock price charts says it all.

Technical analysis is widely used by Trader and Fundamental analysis is done by investor; but swing trading involves both and if done properly it can give handsome return, to find a sticks that’s perfect for swing trade requires a basic understanding of both the above analysis.

Coming to the main discussion, since you are already understand basic of analysis and perhaps already possess this knowledge, lets jump onto find out how to scan and handpick stocks for swing trade. A computer or laptop will be much better and easy for quick result.

1. Open browser and visit tradingview.com- go to screener section- stock screener.

2. Select filter of stocks with New monthly high.

3. From the result- more filteration requires as it’s list will have 200/300+ stocks, there will be sub filter available in the result.

4. Filter out shares with price less than 10(to remove penny stocks). Select stocks with rating to buy/strong buy(technically bullish sign).

5. Select stocks with P/E ratio less than 10 or much below from industry P/E ratio. (Low P/E ratio indicates stocks is cheap at under-valued).

6. Choose and filter market cap as per your choice. Stocks with market cap less than a billion indicates micro cap company and illiquid stocks, if you want to easily buy and sell, select sticks with market cap more than 500 crore at least.

7. Since the screener shows the result from whole stocks from all sector, you have to filter out the stocks from non-growth companies/sector. (I recommend select stocks from- Banking, finance, IT, healthcare, industrial goods, FMCG, Speciality chemical, drugs, Pharma, API manufacturer, retail space).

8. Avoid stocks with heavy debt, Non-growing(see comparative statements from screener.com) lowest NPM (compared to industry margin), highest PE ratio, stocks from Aviation, heavy metals, infra, construction, realty, penny stocks, lot of government restrictions, stocks with no major appreciation in share price in last 5 or 20 years

9. After all this filteration you will have very short list of stocks to select from, since we are already picking stocks from new monthly high screener, they are technically bullish. By shortlisting this way, you will identify fundamentally sound shares.

10. From this shortlisted share dig further quickly before entering into trade. Go to screener.com(you will need to sign up/loging) and enter your stocks/company name and make a quick glance at it’s ratio, margins, comparative statements, share price performance, shareholding pattern, etc.

11. After looking at its fundamentals from screener.com, come to google search page, enter your stock name and just look at its 1/5/20 years chart and see what the chart says about a stock, stock with more than 25x return in last 20 years incldicates green signal(avoid stocks with lot of wild ups and down in its long term chart. Stocks with 30/40/50x return in long term chart is most preferred.

12. Start with small capital and find out the success ratio and keep increasing capital if you find most promising among the whole list. If a stock is trading at new 52 week high or life time with low PE ratio from growing sector, you can remain in trade as long as it’s moving up slowly slowly. You can target for 5%/10%/20%.

Using the same tool you can search stock for long term investing as well. For huge return in long term I recommend micro and smallcap stocks.

Risk part and things to avoid:

Since the investing in stock market is in itself involves inherent risk. And its real money’s game, any mistake means serious money loss, consider the over all market condition before entering into any trade. Though most of the stocks chosen using above formula, its recommended to decide your risk appetite and an exit level. Only trade with spare money and in small capital at initial level. You may also consider gaining knowledge on ratios, fundamental analysis terms and basics of technical analysis, after all its your money and you will have to take charge.

Summary: To swing trade effectively and successfully, you will need to study basic about Investing, trading, fundamental analysis and its terms, Technical analysis and related terms, then open your laptop or computer, sign up for tradingview and screener.com, to use them for your benefit for quick screening and analysis, follow the above steps, start with small amount, gain some experience and keep track of your trade and result for constant improvement.

If you have any opinion, suggestion, recommendation, please feel free to comment. Thanks and have a great day!👍😊

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