A REPORT

ON

“Marketing Practice at Audi Bhubaneswaer”

BY
Md.Ikhlas Bashi
17BSP1497
 A REPORT
ON

MARKETTING PRACTICES AT AUDI BHUBANESWAR

By

MD.IKHLAS BASHI
17BSP1497

AUDI BHUBANESWAR

A REPORT SUBMITTED IN PARTIAL FULFILMENT OF THE

REQUIREMENTS OF PGPM PROGRAM OF
IBS BANGALORE

DISTRIBUTON LIST:

FACULTY GUIDE COMPANY GUIDE

Prof Dr.R.Harish Ashish Mishra

Date of Submission: 16/04/20

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 ABSTRACT

I, Md Ikhlas, student of IBS Bangalore as a part of my internship at Audi Bhubaneswar,

have undertaken this report to Understand and analyse the Marketing strategies and practises
used at Audi Bhubaneswar for their product promotion and Brand recognition.

In Forex Market, we do cross currency trading i.e. two currency trading. Generally, US
Dollar is taken as the base currency to trade. However, cross pair currency trading is also
possible but the risk in those such currencies are higher.

With the availability of new investing channels, Forex Market is also growing day by day.
Investing in Forex Market being easy, convenient and with higher return as compared to
domestic market attracts many investors. Another advantage of trading in forex market over
domestic market is that it is open round the clock i.e. 24 hours from Monday to Friday.

With the help of fundamental, technical and sentimental analysis, one can predict the future
movements conveniently.

The first part of my report consists of fundamental analysis which, helps in deriving the
intrinsic value of the currency or commodity by analysing the micro and macro
environmental factors related to an economy and its pair currency.

The second part consists of the technical analysis which, helps in finding and predicting the
future price movements through trend analysis. There are several indicators and charts for
doing so, but we mainly focus on seven of them which are, Japanese Candle Sticks,
Stochastic Oscillator, Relative Strength Index, Pivot Point, Bollinger Bands, Fibonacci
Levels, and Moving averages. Technical analysts believe past trading activity and price
changes of a security are better indicators of the security's likely future price movements.

Sentimental analysis is based on the buyer’s and seller’s behaviour for a commodity or
currency at a respective price. At a certain price, the buyers/sellers feel comfortable or
generally prefer buying/selling the commodity or currency. It is very difficult for the market
to break this level of price.

The formed report will help the company or any individual in forex trade to predict the price
movements more accurately and help them in entering the trade and gain profits and also curb
on the losses.

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In the final report, I intend to explain further the working of the Candle Stick Charts and the
impact of the different candle stick patterns formed by the price movements and thus how it
is helpful in prediction of the price movements along with the other indicators.

PROJECT INTRODUCTION

Scope and Purpose of Internship

 The primary objective is to understand the trend of the price movements of the currencies and
commodities in the Forex Market and predict future price movements of the same.

 This internship helps in developing the ability to understand the Forex market and trade
accordingly with real accounts opened by the potential clients and gain practical experience in
Forex trading.

 This internship also helps me use and understand various analytical tools like candle sticks,
stochastic oscillators, etc. to predict price movements.

 To develop techniques to analyses the market more efficiently and enter into trade thus,
increasing profits for the traders.

Limitations of the Project

 The study is based only on the past historic data. As such it is subject to the
limitations of the secondary data.

 The time period taken for the study was only 3 months and the results depicted would
vary if the research is taken for a longer period of time or year.
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 Data analysis for a short time may not give accurate results.

 Due to fast and high volatility in the forex market predicting or interpretation may not
be 100% accurate.

 There are various currencies and commodities in the market but the study is limited to
only 5 currencies and 2 commodities.

 The database of potential clients provided are limited to Bangalore region only.

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 About the Company

In the era of constant changing and volatile financial Market, Investors need, qualified,
trained and an unbiased professional to assist them in achieving their short term and long
term investment goal. At Investor centric, our single utmost aim is to assist clients with
dedication and integrity so that we exceed their expectations and build enduring relationships.

J Wings Wealth Manifest has more than a year of experience in Financial Service Sectors. It
offers technology based services for clients to effectively monitor their portfolio and help
them in reaching their financial goals. They focus at being the most reliable prompt and
efficient provider of financial services. It endeavours to be one stop solutions for financial
boutique and to be immense help to the investors, learners and provide help regarding, stock
market, advisory services, training, investment planning, wealth creation and insurance.

For Forex Trading, J Wings has a tie up with Grand Bloom Company Forex Ltd (GBCFX),
with headquarters in Malaysia and Dubai. It has its domestic trading tie up with Zerodha and
Aditya Trading Solutions (ATS) and Insurance tie up with Star Health Insurance.

The company mainly focuses on Forex trading. It generally trades by keeping US Dollar
(USD) as the base price being it the most readily used currency for forex exchange and is
considered to have the most stable economy.

The currencies in which the company trades are:

 US Dollars (USD)
 Switzerland Franc (CHF)
 Australian Dollar (AUD)
 EURO
 Great Britain Pound (GBP)
 Japanese Yen (JPY)

Along with the above mentioned eight currencies, the Company also trades in two
commodities:

 Gold (XAU)
 Silver (XAG)

The company manages a wide variety of portfolios which includes,

 Equity Trading.
 Commodities Trading.
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  Currency Trading.
 Health Insurance.
 Mutual Funds.
 Credit Cards.
 Loans.
 Stock Sip Management.
 Wealth Management.

INTRODUCTION

Foreign Exchange is the process of conversion of one currency into another currency. For a
country, its currency becomes money and legal tender. For a foreign country, it becomes the
value as a commodity. Since the commodity has a value its relation with the other currency
determines the exchange value of one currency with the other. For example, the US dollar in
USA is the currency in USA but for India it is just like a commodity, which has a value
which varies according to demand and supply.

Foreign exchange is that section of economic activity, which deals with the means, and
methods by which rights to wealth expressed in terms of the currency of one country are
converted into rights to wealth in terms of the current of another country. It involves the
investigation of the method, which exchanges the currency of one country for that of another.
Foreign exchange can also be defined as the means of payment in which currencies are
converted into each other and by which international transfers are made; also, the activity of
transacting business in further means.

Most countries of the world have their own currencies The US has its dollar, France its franc,
Brazil its cruziero; and India has its Rupee. Trade between the countries involves the
exchange of different currencies. The foreign exchange market is the market in which
currencies are bought & sold against each other. It is the largest market in the world.
Transactions conducted in foreign exchange markets determine the rates at which currencies
are exchanged for one another, which in turn determine the cost of purchasing foreign goods
& financial assets.

The Foreign Exchange Market (Forex, FX, or currency market) is a global decentralised
market for the trading of currencies. This includes all aspects of buying, selling and
exchanging currencies at current or determined prices. In terms of volume of trading, it is by
far the largest market in the world, followed by the Credit market. The main participants in
this market are the larger international banks. Financial centres around the world function as
anchors of trading between a wide range of multiple types of buyers and sellers around the
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clock, with the exception of weekends. The foreign exchange market does not determine the
relative values of different currencies, but sets the current market price of the value of one
currency as demanded against another.

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Forex analysis is used by the retail forex day trader to determine whether to buy or sell
a currency pair at any one time. Forex analysis could be technical in nature, using charting
tools, or fundamental in nature, using economic indicators and/or news based events. The day
trader's currency trading system use analysis that create buy or sell decisions when they point
in the same direction. Forex trading strategies that use this analysis are available for free, for
a fee or are developed by the trader themselves.

A) Fundamental Analysis

Fundamental analysis is a method of evaluating a security in an attempt to measure its

intrinsic value, by examining related economic, financial and other qualitative and
quantitative factors. Fundamental analysts study anything that can affect the security’s value,
including macroeconomic factors such as the overall economy and industry conditions, and
microeconomic factors such as financial conditions and company management. The end goal
of fundamental analysis is to produce a quantitative value that an investor can compare with a
security’s current price, thus indicating whether the security is undervalued or overvalued.

Fundamental analysis determines the health and performance of an underlying company by

looking at key numbers and economic indicators. The purpose is to identify fundamentally
strong companies or industries and fundamentally weak companies or industries. Investors go
long on the companies that are strong, and short the companies that are weak. This method of
security analysis is considered to be the opposite of technical analysis.

Fundamental analysis uses real, public data in the evaluation a security’s value. Although
most analysts use fundamental analysis to value stocks, this method of valuation can be used
for just about any type of security. For example, an investor can perform fundamental
analysis on a bond’s value by looking at economic factors such as interest rates and the
overall state of the economy. He can also look at information about the bond issuer, such as
potential changes in credit ratings.

For stocks and equity instruments, this method uses revenues, earnings, future growth, return on
equity, profit margins and other data to determine a company's underlying value and potential for
future growth. In terms of stocks, fundamental analysis focuses on the financial statements of the
company being evaluated. One of the most famous and successful fundamental analysts is the so-
called "Oracle of Omaha", Warren Buffett, who is well known for successfully employing
fundamental analysis to pick securities. His abilities have turned him into a billionaire.

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Fundamental Analysis in Forex Market

Fundamental analysis is often used to analyse changes in the forex market by monitoring
factors, such as interest rates, unemployment rates, gross domestic product (GDP) and many
other economic releases that come out of the countries in question. For example, a trader
analysing the EUR/USD currency pair fundamentally, would be interested in the interest rates

In the Eurozone, compared to those in the U.S. They would also want to be on top of any
significant news releases coming out of each country in relation to the health of their
economies.

In this, the Economic factors i.e. both Micro and Macro factors related to the country and their
respective currencies is studied in order to predict the price movement of the currency prices.
Example:

Donald Trump’s election as a President, or Janet L. Yellen (Chairperson of the Board of Governors of
US) speech or US attack on Syria on 6th April, 2017 had a huge impact on the market.

B) Technical Analysis

Technical analysis is a trading tool employed to evaluate securities and attempt to forecast
their future movement by analysing statistics gathered from trading activity, such as price
movement and volume.
Unlike fundamental analysts who attempt to evaluate a security’s intrinsic value, technical
analysts focus on charts of price movement and various analytical tools to evaluate a
security’s strength or weakness and forecast future price changes.

Technical analysis is used to attempt to forecast the price movement of virtually any tradable
instrument that is generally subject to forces of supply and demand, including stocks, bonds,
futures and currency pairs. In fact, technical analysis can be viewed as simply the study of
supply and demand forces as reflected in the market price movements of a security. It is most
commonly applied to price changes, but some analysts may additionally take numbers other
than just price, such as trading volume or open interest figures.

Technical analysts apply technical indicators to charts of various timeframes. Short-term

traders may use charts ranging from one-minute timeframes to hourly or four-hour

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timeframes, while traders analysing longer-term price movement scrutinize daily, weekly or
monthly charts.

Over the years, numerous technical indicators have been developed by analysts in attempts to
accurately forecast future price movements. Some indicators are focused primarily on
identifying the current market trend, including support and resistance areas, while others are
focused on determining the strength of a trend and the likelihood of its continuation. Out of
the various indicators and charts, for our analysis we basically use seven types of charts.
They are:
i) Japanese Candle Sticks
ii) Stochastic Oscillator
iii) Relative Strength Index
iv) Moving Averages
v) Pivot Point
vi) Bollinger Bands
vii) Fibonacci Levels

I Japanese Candle Sticks

Fig: 1

A candlestick chart (also called Japanese candlestick chart) are thought to have been
developed in the 18th century by Munehisa Homma, a Japanese rice trader of financial
instruments. They were introduced to the Western world by Steve Nison in his
book, “Japanese Candlestick Charting Techniques”. They are often used today in stock
analysis along with other analytical tools.

It is a style of financial chart used to describe price movements of a security, derivative,

or currency. Each "candlestick" typically shows one day; so, for example a one-month chart
may show the 20 trading days as 20 candlesticks. It can be 1min, 15mins, 30mins, 1hr,
4hrs, daily, weekly & monthly.

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It is like a combination of line-chart and a bar-chart: each bar represents all four important
pieces of information for that day: the open, the close, the high and the low. Being densely
packed with information, they tend to represent trading patterns over short periods of time,
often a few days or a few trading sessions.

Candlesticks are usually composed of the body (black or white), and an upper and a lower
shadow. The area between the open and the close is called the real body, price excursions

Above and below the real body are called shadows. The Shadow illustrates the highest and
lowest traded prices of a security during the time interval represented. The body illustrates the
opening and closing trades. If the security closed higher than it opened, the body is white
or unfilled, with the opening price at the bottom of the body and the closing price at the
top. Similarly, if the security closed lower than it opened, the body is black, with the
opening price at the top and the closing price at the bottom (refer fig: 1). A candlestick
need not have either a body or a shadow.

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To better highlight price movements, modern candlestick charts (especially those displayed
digitally) often replace the black or white of the candlestick body with colours such as red
(for a lower closing) and blue or green (for a higher closing). They are most often used
in technical analysis of equity and currency price patterns. They appear superficially similar
to box plots, but are unrelated.

However, there are three types of market movement. They are bullish, bearish and side way.
It is recommended not to enter market if it is side way.

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II Stochastic Oscillator

Fig: 2

The Stochastic Oscillator was created by George C. Lane and introduced to the trading
community in the late 1950s. It was one of the first technical indicators used by analysts to
provide insight into potential future market direction and is based on the premise that during a
market uptrend, prices will remain equal to or above the previous period closing price.
Alternatively, in a market downtrend, prices will likely remain equal to or below the previous
closing price.

Using a scale to measure the degree of change between prices from one closing period to the
next, the Stochastic Oscillator attempts to predict the probability for the continuation of the
Current direction trend. Traders look for signals generated by the actions of the stochastic
lines as viewed on the stochastic scale.

In this we can see that there are two lines, red and blue (refer fig: 2). the blue line is for
the buyers and red line is for the sellers. When blue line is above red line then, we say
that the market is strong for buyers as compare to sellers or there are more buyers in
the market as compared to sellers and it is expected the market to go up and vice versa.

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III Relative Strength Index

Fig: 3

The relative strength index (RSI) is a momentum indicator developed by noted technical
analyst Welles Wilder that compares the magnitude of recent gains and losses over a
specified time period to measure speed and change of price movements of a security. It is
primarily used to attempt to identify overbought or oversold conditions in the trading of an
asset.

For our trading, we analyze RSI by taking 3 levels at 70, 50 and 30. If RSI is above 70
then, it shows that the currency or commodity is overbought and the price is expected to
go down. Similarly, if it is below 30 we can say that it is oversold and it is expected that
the price will go up.

IV Moving Averages

Fig: 4

A moving average is simply a way to smooth out price action over time. For this, we take
the average closing price of a currency pair for the last ‘X’ number of periods.
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 Like every indicator, a moving average indicator is used to help us forecast future prices. By
looking at the slope of the moving average, you can better determine the potential direction of

Market prices. There are different types of moving averages and each of them has their own
level of “smoothness”.

Generally, the smoother the moving average, the slower it is to react to the price movement.
The choppier the moving average, the quicker it is to react to the price movement. To make a
moving average smoother, you should get the average closing prices over a longer time
period. There are two major types of moving averages; Simple and Exponential.

Forex traders use moving averages for different reasons. Some use them as their primary
analytical tool, while others simply use them as a confidence builder to back up their
investment decisions. In fig: 4, the moving average is represented by the red line on the
graph. For currencies, we take 50 days moving average while for commodities we use 21
days and 55days moving average as it gives better predictions for movement of prices
for commodities.

V Pivot Point

Trading requires reference points (support and resistance), which are used to determine when
to enter the market, place stops and take profits. However, many traders focus on technical
indicators such as Moving Averages and Relative Strength Index (RSI) and fail to identify a
point that defines risk. Unknown risk can lead to margin calls, but calculated risk significantly
improves the odds of success over the long haul.

One tool that actually provides potential support and resistance and helps minimize risk is
the pivot point and its derivatives. A combination of pivot points and traditional technical
tools is far more powerful than technical tools alone and this combination, can be used
effectively in the forex market.

Generally, for our trading we find 3 levels of resistance and 3 levels of support. In order to
compute Pivot point, we take high low and close values in a daily or weekly or monthly
for daily weekly and monthly pivot points respectively.

Originally employed by floor traders on equity and futures exchanges, pivot point has proved
to be exceptionally useful in the forex market. In fact, the projected support and resistance
generated by pivot points tends to work better in forex market (especially with the most liquid
pairs) because the large size of the market guards against market manipulation. In essence, the
forex market adheres to technical principles such as support and resistance better than
less liquid markets.

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VI Bollinger Bands

Fig: 5

Bollinger Bands are a technical chart indicator popular among traders across several financial
markets. Generally, on a chart, Bollinger Bands are two “bands” that sandwich the
market price but, we use three bands (fig: 5) with a period 20 as it helps is deciding the
range more precisely for an intraday trader as compared with two bands. Many traders
use them primarily to determine overbought and oversold levels. One common strategy is to
sell when the price touches the upper Bollinger Band and buy when it hits the lower Bollinger
Band. This technique generally works well in markets that bounce when it hits the lower
Bollinger Band. This technique generally works well in markets that bounce around in a
consistent range, also called range-bound markets. In this type of market, the price bounces
off the Bollinger Bands like a ball bouncing between two walls.

Even though prices may sometimes bounce between Bollinger Bands, the bands should not be
viewed as signals to buy or sell, but rather as a “tag”. As John Bollinger was first to
acknowledge, “Tag of the bands are just that – tags, not signals. A tag of the upper Bollinger
Band is not by itself a sell signal. A tag of the lower Bollinger band is not by itself a buy
signal.” Price often can and does “walk the band”. In those instances, traders who keep trying
to sell when the upper band is hit or buying when the lower band is hit will face an
excruciating series of stop-outs or worse, an ever-increasing floating loss as price moves
further and further away from the original entry point. A better way to trade with Bollinger
Bands is to use them to gauge trends.

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VII Fibonacci Levels

Fig: 6

The Fibonacci studies are popular trading tools. Understanding how they are used and to what
extent they can be trusted is important to any trader who wants to benefit from the ancient
mathematician’s scientific legacy. While some traders unquestionably rely on Fibonacci tools
to make major trading decisions, others see the Fibonacci studies as exotic scientific baubles,
toyed with by so many traders that they may even influence the market.

It was during the travels of the Italian Leonardo Pisano Fibonacci along with his father that
the ancient Indian system of nine symbols and some other mathematical skills that would lead
to the development of Fibonacci numbers and lines. “Libre Abaci” (1202), one of his work
contained some practical tasks that were related to merchant trade, price calculations and
other problems that needed to be solved as a matter of their everyday activities. An attempt to
solve a sum about the propagation ability of rabbits gave birth to the system of numbers that
Fibonacci is known for numbers that precede it seems to be nature’s underlying principle
behind life’s many events and phenomena. He applied his life- inspired theory in conjunction
with geometrical constructions and hence is used by traders to gain profits.

The Fibonacci sequence is as follows:

1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, …. And so on.

This sequence moves toward a certain, irrational ratio. In other words, it represents a number
with an endless, unpredictable sequence of decimal numbers, which cannot be expressed
precisely.

There are five types of trading tools that are based on Fibonacci’s discovery. They are:

 Arcs
 Fans
 Retracements
 Extensions

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  Time zones.

The lines created by these Fibonacci studies are believed to signal changes in trends
as the prices draw near them.

FINDINGS (TILL DATE)

Firstly, there are three types of market movement. They are bullish, bearish and side way. It is
recommended not to enter market if it is side way.

Secondly, during our training period the most important point I came across is that we should always
put stop loss while trading. There is no good stock or bad stock the price is wrong or right. We trade
in lots. Minimum loss to profit ratio is 1:1.5. Stop loss refers to a price a trader keeps if the market
does not react or move according to its predictions i.e. if a trader takes a buy call then, it will keep
stop loss below the buying price which in case of loss will trigger and the call will close with a
particular sum of loss. As the great American Investor and Security analyst, Jesse Lauriston
Livermore said, he has not seen any trader gain from market much without keeping stop loss. He even
said that one must always keep stop loss and incur small losses in order to save oneself from the
mother of losses. There are 5 basic methods to compute the stop loss price. They are

 Fixed dollar amount

 Percentage change in a day
 Opening price %
 Technical analysis
 Sentimental analysis.

Thirdly, I was provided with the database of potential clients to approach and convince them to
invest. After approaching 475 clients over call, I discovered that out about 85% (approximate) of
them, have never ever been heard of forex trading. It was new for them and they were hesitant of
making investments in Forex market, and they preferred domestic market above it because of more
popularity and they felt safe in that even though they were offered a return of minimum 18% per
annum, which is approximately thrice the return an investor gets if he does a fixed deposit of the same
amount.

Fourthly, after being able to convince a client, I was able to open a live trading account of 1000$ and
was supposed to conduct trading on behalf of the client. While trading, the impact of both, the
fundamental and technical analysis was better understood.

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 Fig: 1

In the above graph (Fig: 1), we see that on 7th April, 2017 there is a great spike in price of Gold/USD
as pointed by a grey arrow. On this day, all the technical analysis where predicting the price of gold to
fall or a bear market for gold. However, irrespective of that, the price went up to 1270.41 from
1251.53 which means approximately 19 stick movements which is huge. This was due to
Fundamental Analysis. A news broke out that United States had fired 60 Tomahawk Missiles at a
military airfield in Syria. Due to this, the demand for Gold increases as people were expecting war
during which the currency value decreases or becomes unstable and every investor looks to purchase
gold as it is a reserve for every country. Hence, the Gold price went up due to Fundamental Analysis.
Thus, if a trader is following only technical analysis then, there might be some times when the
market will not follow technical and due to a huge micro or macro environmental news, the market
may change resulting into huge losses.

Fig: 2

Similarly, if look at the above graph (Fig: 2), we see that on 11th April 2017, there is a high rise in
price Gold/USD i.e., it opened at 1254.55 and closed at 1274.37. According to fundamental analysis,

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there was no expectation of the price to go up or for a bull market for gold. However, it still went up
and closed approximately 20 sticks above the open price which was not expected by fundamental
analysis. This was due to technical analysis, as according to stochastic oscillator, moving average,
Fibonacci levels and relative strength index, the market was supposed to go up or a bull market. Thus,
we can say that if a trader is following only fundamental analysis then there might not be any news
about the economy yet there are price movements and to understand that one needs to do technical
analysis.

Conclusion
Thus, after conducting all the three analysis and predicting the price movements, the trader should
enter into the trade in order to minimize losses and maximize profits with less risk. Only one analysis
is not sufficient for earning profits or to become a good trader due to the dynamic nature of the market
and it is very important to keep stop loss.

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