Investment in RNRL - short term 15% gains possible

RNRL buy at current levels, stoploss 62, initial target 70, next target 77

The stock tested the levels of just above 60 in November, traded sideways for the next 3 months with the investors undecided about the future of the stock. Global financial turmoil due to happening in Greece led to lowered risk appetite towards risky investments. As the Sensex tested its 200 DMA, the stock too broke from 75 and tested the November lows. The stock could be bought at current levels with a stoploss of 62, first target would be February high which means the investors could bid the stock at levels close to 70 and if the investors still hold onto the stock the price could further enhance upto the levels of 77 which is the current year high, the rate above which the investors did not bid the stock this year uptil now.

The target of 70 could be achieved within next 5 days, return on investment turns out to be above 6%. Next target of 77 could be achieved by mid April, return on investment above 15%.

Gold, is it a Candidate for Investment?

Like any another Commodity, prices of precious metal Gold depend on demand and supply, when the prices of Gold move up from say 1000 dollars per ounce to 1200 dollars per ounce, it means that earlier 1000 dollars invested were sufficient to buy 1 ounce Gold, but now an investment of 1200 Dollars can let you own 1 ounce.

Now if we consider investor demand for Gold has not changed then

• Either the informed investors are betting supply of Gold would be reduced against the number of dollars likely to float around the world in future and have bought Gold in anticipation.

• Or The informed investors are betting that there would be a huge supply of dollars in future which the supply of Gold would not be able to match up, loaded with dollars the investors would be bidding up the price of Gold, in anticipation of the future Informed Investors have bid up the prices of Gold

Looking at the charts, we get a picture that for the 2 years between 2007 and 2008, new investors buying the gold and old investors selling the Gold were equally placed in a price war and whenever new investors got a hold of Gold at near 860 dollars they would buy the Gold while whenever the prices rushed above 970 dollars, old investors would sell to book profits in there investment, A small period of 2-3 months between september to november 2008 saw sellers gaining an upper hand, new investors seemed as loosing patience and triggering stop loss, prices crashed unto 700 Dollars an ounce, but the introduction of TARP (troubled asset relief program) in october 2008 saw the informed investors bidding the prices of Gold above the previous high of 1040 dollar.

Looking to invest in Gold, wait for your desired investment target to witness a price of 970 Dollars, or the other way round cross the previous 2009 high, there are many ways (fundamental and technical) through which you can zero in on the price to invest in an asset and then book your profits and exit from the asset, also you can leverage through options if you have worked out and know exactly the time by which you expect your investment to reach a level where you can book profits, I have shown you the most basic identifications, if you wish to know the advanced ways subscribe through the PayPal link given at the top, for further queries, write to click_dotcom@rediffmail.com