Media sector at the verge of a Long term breakout

Big Muti-year Base Breakout you wouldn't wanna miss.

Jan 13, 2024

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"Bigger the base, bigger the move" ~ Mr. Chart

The media sector is on the verge of a big multi-year base breakout.

And I wouldn’t miss it for anything.

But why am I so feckin excited about it?

What’s special?

Let’s first look at the chart of Nifty Media below:

Big Base:
It is currently at the horizontal resistance that is 58 months old.
58 months is a very big base.
And you know what comes after a big base, right?

This would be the 4th Breakout attempt:
The more times the resistance is tested, the more significant it becomes and the weaker it becomes.

Add in the fact that the pattern i.e. an Ascending Triangle is formed which is a bullish reversal pattern, and suddenly media becomes a prime candidate for Long term as well as positional play (given it breaks out. Of course).

Stage 1 to Stage 2 transition:
Stan Weinstein would be all over them right now as this is where he liked to make most of his buys. A perfect spot for entry if you are a positional trader/investor.
But mind you, the initial period of a stage 2 move can be slower than the liking of a swing trader. (expectation check).

So, Big Base and Constructive Accumulation Heavy Base and a Stage 2 Transition.

Examples of recent big base breakouts:

Although chart patterns are not the same, look at some of the big base breakout effects below.

BSE Power:
CNX PSE:
CNX Realty: The most recent one

But this (impending) Media and Realty moves are fundamentally different. How?

Realty move is led by index constituents, Media is NOT:

See the data below. I compare

Average % move of all Stocks in the sector Vs. % move by the index.

Media and Realty stocks have moved the same on average in the last 20 days ~13%.

But Nifty Realty is the highest performer at >16% vs Nifty Media which is languishing at the bottom with barely positive returns.

Wild. isn’t it?

What could this mean for the Media stocks?

Individual Media stocks (non-index) already breaking out of Big bases:

For starters, it could mean that the stocks in the media index are lagging. And that the leaders of the group are already making their moves out of their respective bases.

I would have highlighted some names for you here, but alas! internet in my village is pre-Jio levels.

So instead. I will link a video to the Media supersession I had with my HPA community early this week. Here.

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Lastly.

All of this is a Khayali Pulao and in anticipation of the Stage 2 Big Base Breakout.

So remember these lines:

“Anticipate, but wait for confirmation. Hope, but only react.”

That's all for today.

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