Score 8.7 (out of 10): India’s Nifty 50 (SGX) poised to seasonally rally by +6.1% during the next 60 days

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What’s Going On Here?

The stock market in India has gone through a mild confidence re-adjustment as the recently listed shares of payment solutions provider Paytm’s saw a drop of 41%. Now with news surfacing that anchor investors (Blackrock, Canada Pension fund, etc.) are increasing their stakes, sentiment might turn positive again. Paytm’s shareholders include big-name investors like Warren Buffett’s Berkshire Hathaway and Son’s SoftBank Group.

Why Now?

SGX Nifty 50 indicates an interesting 60 days seasonal set up. During similar occasions, SGX Nifty 50 shares had a median return of +6.1% – based on 10 historical occasions with 9 of those showing positive returns (90%). This buy signal for SGX Nifty 50 received a high score of 8.7 (out of 10). This insight was generated with last price of 17388.

What’s This Index About?

SGX Nifty 50 represents 50 large cap names in the Indian stock market. Based on the last 2 years’ risk/return profile, this asset is seen as Less Risky.

What’s My Risk / Reward and Time Horizon?

We found 60 days to be the optimal trade horizon, after testing a number of possible alternatives (accuracy of previous returns). Otherwise consider closing out this trade once the target level of 18447.16 (+6.1%) has been reached. Based on SGX Nifty 50’s recent up and down swings, LongShortBets suggests considering to set a stop loss level for this insight at 16821 (last price at 17388), which is equivalent to a -3.3% decline.

Returns during similar periods:

The chart above shows the previous returns (in %) based on similar setups with the most recent ‘insight’ shown under (1), the second most recent ‘insight’ shown under (2), etc. 

Previous episodes:

7.6% (November-2021), 2.4% (November-2020), 3.1% (November-2019), 6.7% (November-2018), 7.8% (November-2017), -4.9% (November-2016), 3.7% (November-2015), 5.5% (November-2014), 7.7% (November-2013), 8.7% (November-2012)

Historical Chart:

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Summary:

NameIndia’s Nifty 50 (SGX)
ViewUp
Star (1 to 10)8.7
Target+6.1%
Time2 months
Hit Rate90%

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