Dhanlaxmi Bank

Sahil:

Long-term: Either I want the Bankex to reverse its current downtrend or I would really have to be convinced in Dhanbank's ability to create value for me. I'd have to do a complete bottom-up analysis of Dhanbank to determine its value creation potential (which will take a significant amount of time to do...). I could overlook sector conditions to a certain extent if there is tremendous value creation potential. BUT, I need the ability to withstand a negative or stagnant position for possibly a significant amount of time. Not my style of investing 'yet'.

The shorter-term: Technicals
Not looking too pretty if you want to go long.
1) I'd consider a long position only above 125. Not really interested in parking my money as I wouldn't know whether we'll witness a pick up in momentum if I buy at a lower price. But, once the 125 barrier is breached, there should be greater buying interest.
2) I'd also recommend a buy at around the 95 region and anticipate a bounce upto 110-115. But this would be like catching a falling knife. If you do, have a tight SL.
3) You can buy at a lower price once we see that the trend has reversed. But, going off of today's chart, I don't see any such signal.

Remember, the market price is at a certain level for a certain reason. Personally, I'm not interested in being the genius who spotted the true potential of a company and bought in with the accumulators. I'm looking for a level when there will be greater interest. Targeting a return potential of 20-50% in 1-3-6 months. There's no guarantee that there will be greater interest at 125, but I'll be much more comfortable taking that risk.

Sanjeet