The market decides to love a sector and then goes crazy about it. Organized Retail was one sector where market started its bullish stance during middle of 2016 but then post demonetization, it went crazy about it.
The first stock that created buzz in this space: V2Retail in August 2016
Source: Chartalert.com
The stock broke out in August 2016 but made no real progress till January 2017. It’s only then it took off and made a huge vertical move
The next hint that market loves organized retail came from: Bullish move in Trent from 200 dma in Dec 2016
Source: Chartalert.com
As you can see in the chart above – just see how Trent stock has moved up over last 12 months with stock taking major support at 200 day moving average
When market participants get excited about a sector, then sky is the limit: The next mover was VMart
Source: Chartalert.com
As you can see in the chart above – VMart also saw a vertical move post breakout in Feb 2017. In the same month, there was another stock of the same sector that made the big move: Future Retail
Source: Chartalert.com
Future Retail stock made a very powerful move and it seems like the stock is not done with it. On every decline, the stock will find takers.
Perfect time for DMart IPO – Organized retail stocks made big momentum moves in Feb 2017 just before the DMart IPO. It benefited DMart to make a solid momentum move.
Source: Chartalert.com
Bull Market in a sector is like a wildfire. It spreads and catches practically every major stock of that sector. Finally, it reached Shopper Stop. Amazon picking up minor stake helped stock breakout.
Source: Chartalert.com
The Good news: Bull Market in Shopper Stop is very young. Any minor decline near 100 dma/levels of 500 can be another opportunity to enter. On any major market correction, stock can decline to 200 dma/430 levels but what one needs to watch – Stock preparing itself for breakout above previous high
Source: Chartalert.com
Conclusion
Organized Retail stocks saw a big momentum breakout move this year and it looks like the stock that still has to make a move: Shopper Stop. Also, the sector still looks attractive and will find lots of takers on declines.
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers