INTERNATIONAL INSTITUTE OF PROFESSIONAL STUDIES, D.A.V.V.

A PRESENTATION
ON
FORECASTING TECHNIQUES

SUBMITTED BY: SUBMITTED TO:

ADITYA YADAV-06 Mr. VANDIT HEDAYU
ADWAIT VERMA-08
ANKIT SINGH SISODIYA-14
HARSHAD PATIDAR-36
 INTRODUCTION

 IndusInd Bank derives its name and inspiration

from the Indus Valley civilisation - a culture
described by National Geographic as 'one of the
greatest of the ancient world' combining a spirit
of innovation with sound business and trade
practices.
 Formally inaugurated in April 1994 by Dr.
Manmohan Singh
 Mr. Srichand P. Hinduja, a leading Non-Resident
Indian businessman and head of the Hinduja
Group, conceived the vision of IndusInd Bank
FEATURES

 The Bank caters to the needs of both Consumer

& Corporate Clients.

 A network of 209 branches and 427 ATMs.

 It has multi-lateral tie-ups with other banks.

 It enjoys clearing bank status for both major

stock exchanges - BSE and NSE - and three
major commodity exchanges in the country –
MCX, NCDEX, and NMCE. 
 In a pioneering initiative in ‘Green Banking’ the
Bank became the first bank in Maharashtra to
open a solar-power ATM.

 Deals with subjects like sustainable

development and social responsibility.

 The Bank has been awarded the highest P1+

rating for its Fixed Deposits and Certificates of
Deposit by CRISIL.

 Offers a new level of banking – better services,

better understanding of unique needs and
better management of finances.
FORECASTING TECHNIQUES:

 MOVING AVERAGES

 SIMPLE MOVING AVERAGE

 EXPONENTIAL MOVING AVERAGE

 SINGLE EXPONENTIAL
SMOOTHING
 SIMPLE MOVING AVERAGE(SMA)

 They smooth a data series and make it

easier to spot trends, something that is
especially helpful in volatile markets. 

 A simple moving average is formed by

computing the average (mean) price of a
security over a specified number of
periods. 
 EXAMPLE
09-Sep-10 18,669.12 18,823.17 18,669.12 18,799.66 13,200 18,799.66 18,324.10 18455.38
08-Sep-10 18,627.67 18,721.21 18,540.65 18,666.71 20,200 18,666.71 18,267.73 18378.88
07-Sep-10 18,571.73 18,711.20 18,571.43 18,645.06 14,600 18,645.06 18,235.45 18314.92
06-Sep-10 18,124.29 18,600.30 18,124.29 18,560.05 18,200 18,560.05 18,214.02 18241.57
03-Sep-10 18,238.08 18,316.32 18,206.50 18,221.43 9,400 18,221.43 18,199.64 18170.8
02-Sep-10 18,215.28 18,355.84 18,215.28 18,238.31 13,400 18,238.31 18,220.86 18159.55
01-Sep-10 18,027.12 18,227.14 18,027.12 18,205.87 14,400 18,205.87 18,222.57 18142.05
31-Aug-10 18,015.66 18,015.66 17,819.99 17,971.12 16,400 17,971.12 18,208.30 18127.87
30-Aug-10 18,063.48 18,216.50 17,960.23 18,032.11 11,600 18,032.11 18,215.54 18162.7
27-Aug-10 18,205.90 18,248.36 17,944.16 17,998.41 13,600 17,998.41 18,227.81 18191.72
26-Aug-10 18,194.78 18,261.06 18,159.13 18,226.35 12,800 18,226.35 18,234.67 18,234.67
25-Aug-10 18,308.51 18,312.43 18,156.00 18,179.64 15,800 18,179.64

24-Aug-10 18,407.01 18,451.73 18,260.71 18,311.59 14,400 18,311.59

23-Aug-10 18,400.33 18,454.38 18,371.02 18,409.35 11,400 18,409.35

20-Aug-10 18,444.24 18,464.14 18,360.90 18,401.82 14,200 18,401.82

19-Aug-10 18,276.50 18,475.27 18,276.50 18,454.94 14,600 18,454.94

18-Aug-10 18,067.67 18,286.00 18,067.67 18,257.12 14,800 18,257.12

17-Aug-10 18,049.19 18,140.15 18,026.00 18,048.85 12,800 18,048.85

16-Aug-10 18,169.80 18,203.92 17,997.46 18,050.78 16,000 18,050.78

13-Aug-10 18,080.29 18,260.39 18,050.42 18,167.03 18,600 18,167.03

12-Aug-10 17,972.65 18,113.62 17,914.78 18,073.90 19,600 18,073.90

SMA GRAPH
22,000.00

21,000.00

20,000.00

19,000.00 Close
SMA
EMA

18,000.00

17,000.00

16,000.00
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 61 63 65
 EXPONENTIAL MOVING AVERAGE(EMA)

 The EMA would focus more on most recent

prices rather than on a long series of data
points, as the simple moving average
required.

To Calculate an EMA
 Current EMA= {(Price(current) - previous
EMA) X multiplier} + previous EMA. 

 The most important factor is the smoothing

constant that = 2/(1+N) where N = the
number of periods. 

 A 10-PERIOD EMA  = 2/( 10+1) = 0.1818

Trend-Following Indicators

 As lagging indicators, moving averages

serve well as support and resistance lines.

 If prices break below a 10-period fitting line

in an upward trend, chances are good that
the upward trend may be waning, or at
least the market may be consolidating.

 If prices break above a 10-day moving

average in a downtrend, the trend may be
waning or consolidating.
USES OF MOVING AVERAGE

 The first trend identification technique uses

the direction of the moving average to
determine the trend. If the moving average
is rising, the trend is considered up. If the
moving average is declining, the trend is
considered down

 The second technique for trend

identification is price location. f the price is
above the moving average, the trend is
considered up & vice-versa.
CONCLUSION

 Moving averages can be effective tools to

identify and confirm trend, identify support
and resistance levels, and develop trading
systems.

 Moving averages are trend following, or

lagging, indicators that will always be a step
behind.