Published on: June 10, 2024
Whirlpool India, a subsidiary of the renowned American multinational Whirlpool Corporation, is a key player in the Indian home appliances market. The company is well-positioned for growth with a strong brand presence and an extensive distribution network. Whirlpool India’s focus on innovation and customer satisfaction, as well as its continuous introduction of advanced products tailored to the needs of Indian consumers, further enhances its growth potential. Its robust financial performance and strategic initiatives underscore its readiness for sustainable growth in a competitive industry.
With a market cap of Rs. 21,400crs, the stock price seems to be finding its base on the NSE and BSE. From its 52-week low of Rs.1,186 in February 2024, the stock has reversed and is approaching Rs.1,700. Is the worst over for the stock?
As per Wyckoff Analysis, the stock is poised for a big move in the medium to long term.
Wyckoff Analysis – The Smart Money Theory
Wyckoff Analysis is a method developed by Richard D. Wyckoff, focusing on understanding the market by studying price action, volume, and time. It provides a framework to identify the phases of a market cycle: accumulation, markup, distribution, and markdown. During accumulation, smart money or institutional investors quietly buy large quantities of stock over time, absorbing supply without significantly increasing prices. This phase is characterised by a trading range where the price oscillates between support and resistance levels, often forming a base before a significant upward move.
Accumulation Process on Whirlpool India Weekly Chart
The weekly chart of Whirlpool India exhibits classic signs of the accumulation process described by Wyckoff Analysis.
In this phase, the stock moves within a horizontal trading range, indicating that large investors are accumulating shares. Key characteristics include relatively stable prices and spring/shakeouts designed to mislead and eliminate weak holders. The reversal signalled by rising volumes indicates smart investors are taking the stock higher.
Once a breakout above resistance at Rs.1,750 with increased volume, the stock will likely enter the markup phase, leading to a significant price rise.
Investors can keep this on the radar and wait for the breakout.
