From Glitter to Gloom: The Fall of Kalyan Jewellers

Kalyan Jewellers was apparently the most searched stock in the last few days and rightly so. This stock has given a return of outstanding **-45%** in the last 16 trading sessions. [The magnificent fall](https://preview.redd.it/ko7sbsqppjfe1.jpg?width=2919&format=pjpg&auto=webp&s=66f95a4985a3983e235abeb2d906ecc0ca78a279) It can be seen that the stock has been facing large selling pressure with a downwards trend by analysing the OI of the stock. [OI analysis \(1\/2\)](https://preview.redd.it/405awk5c8jfe1.png?width=2726&format=png&auto=webp&s=c24b22fd376984d88e818a21ba2f1d129f7d4b90) [OI analysis \(2\/2\)](https://preview.redd.it/y0nrqhhe8jfe1.png?width=2740&format=png&auto=webp&s=2252adc0f7f53b6b98dc8f1781561665cf2c8836) [Futures OI \(1\/2\)](https://preview.redd.it/h3hu4fzm8jfe1.png?width=2704&format=png&auto=webp&s=4e39686c0e80baee5e544275601d252c558bdffb) [Futures OI \(2\/2\)](https://preview.redd.it/huondm1q8jfe1.png?width=2693&format=png&auto=webp&s=015d0734ac3ca82eb8d2350934d4caad0e985f38) In above data/graphs, we can observe that shorts were created starting from January 3rd 2025 and they are still being created as till date i.e January 17th 2025. This indicates heavy selling pressures from the institutions and big market players.  This is also confirmed when looking at the delivery margins of the trades made in this stock. The delivery percentage is low and the quantities were dumped by the big players so anyone buying was forced to keep their purchases to their holdings or book their SL which obviously isn’t the habit of majority of retail players.  [Delivery % ](https://preview.redd.it/cc4it5j8dkfe1.jpg?width=2701&format=pjpg&auto=webp&s=17a7d8422b4a39633c79aaa37da052cb7b6d500b) https://preview.redd.it/zevq80fcdkfe1.jpg?width=2691&format=pjpg&auto=webp&s=c4fd6278e12454964cd01158d4fc8b81c70fb29d Now to explain, How this stock was dumped? It’s simple. Use the classic tried and tested with guaranteed result traditional technique to plant and then harvest the emotions of greedy **“over-smart”** retail investors who are gullible, short sighted and do not look at the company’s technical or fundamental structure, instead believe in anything that they are told by their market expert analyst masters.  **Just like in IGL from our previous post:(https://www.reddit.com/r/IndianStockMarket/comments/1gde0i0/how\_operators\_and\_rating\_agencies\_cleverly\_fool/)**, To reach those retail investors and create liquidity, they used news to create a FOMO buying by emphasising on the quarterly update and by making bold claims of the growth in domestic as well as in the foreign markets. Anil Singhvi’s Video: [A push for Kalyan Jewellers](https://reddit.com/link/1ib9d77/video/o2zn6nnrajfe1/player) Just like in IGL, the stock was up 4.5% in pre-open, and in a state where the markets were flat to negative. This was enough to create a FOMO for the retail investor who had either seeing their portfolios in deep red or already booked their losses in this recent market correction where every other day, market goes down and their portfolio goes down even more. This time the news channels were smarter where they can claim that the stock achieved their target and save themselves from the shame and reputation issues. [Iske baad bhi badhega, Aaj ka hero XD](https://reddit.com/link/1ib9d77/video/mfyy3t38bjfe1/player) These people were happy that the stock opened at 777.05 and hitting their target of 760/770/782, targets were hit but it were hit within the first two minutes and gave a gain of 0.63% which is laughable for the promised big gains but their targets were hit so there’s no liability for them and nothing for them to answer. If the retail investor had bought this, it would definitely be a loss making trade.  It can also be seen that they promoted this stock after it hit their laughable target in two minutes and was down to 2.5%. Those who bought viewing this will be in loss. [Kalyan Jewellers is here to stay](https://reddit.com/link/1ib9d77/video/exh3zcpybjfe1/player) https://preview.redd.it/m2tzhg73cjfe1.png?width=2822&format=png&auto=webp&s=6b03555d8c080dfb4886c32273f71390c5ff2c36 The stock ended its day with a return of \~8% from its peak. [Kalyan Jewellers January 6th, 2025 in minute candles](https://preview.redd.it/ugv7nvcfcjfe1.png?width=2805&format=png&auto=webp&s=2dd4fd58c6e68495a7507fd1b8bc3dad8f6cef67) Now since its fall, the speculation of fund houses selling this stock was also raised by them as well, as to safeguard themselves and as well as seem like an intellectual to the general public a few days later. https://reddit.com/link/1ib9d77/video/wch06oswcjfe1/player It can be seen that the RSI was weakening since January 3rd. RSI is relative strength index, this indicator can help the strength of a price for a stock, as like to tool to see the higher high could be sustained or lower low be reversed. The RSI for this stock is weakening meaning the price is going up but is unsustainable as it contains no strength in its movement, generally based upon weak buying, and obviously not from the big and strong market participants.  We can use a rocket as an analogy. A rocket gains altitude by burning fuel, which acts as the propellant and generates thrust. In financial terms, we can think of thrust of the rocket as the Relative Strength Index (RSI). The stronger the thrust, the higher the RSI the higher the price momentum, indicating a sustainable upward movement. However, there's a catch: the price of an asset can still rise even if the RSI starts to cool off. This is similar to a rocket continuing to ascend due to inertia, even after its fuel is exhausted. However, this gain in altitude is unsustainable, as gravity will eventually cause the rocket to fall back down. [Relation of RSI and Price](https://preview.redd.it/avn0yzaldjfe1.png?width=2919&format=png&auto=webp&s=c289764e842815c74e50c4d922d9a10c1f81683f) In financial markets, this phenomenon is comparable to a "profit-booking phase" or a "resistance zone," where prices start to correct after a strong rally. In the context of smart money concepts, this correction often aligns with an increase in short positions, as observed from the Futures Open Interest (OI) data. Those who tried to catch a falling knife were also trapped as the delivery percentage was low and thinking of a bounce back with this huge fall from the top.  There were some other stock that these media channels promoted on January 6th the same day as Kalyan.  1. InfoEdge (Naukri): [InfoEdge](https://preview.redd.it/rlogwycrdjfe1.png?width=2919&format=png&auto=webp&s=1817eb4fde34e3d19b2492e101f569a84544af82) 2. BharatForge: [BharatForge](https://preview.redd.it/soc72v5xdjfe1.png?width=2918&format=png&auto=webp&s=992042ee55980ea28bdf5cc8eaab1eb58846b5ea) 3. Zomato: [Zomato](https://preview.redd.it/9f6shmx2ejfe1.png?width=2905&format=png&auto=webp&s=7253a701508243fc916d6cd0093cdd68a6901a1b) It's also interesting to see them recommend Zomato as following their advice, Zomato published a negative news about their weak financials. All of these fall were further fuelled by negative sentiments and the fall observed in the market, leading to losses for the people who don’t really know the concepts of a stop-loss. Please view news channels as sources of information, not as absolute authorities to follow blindly. Remember, they are not market experts—no one truly is. If they were genuine experts, they wouldn’t be sitting in front of a camera earning a salary; they’d be making billions in the market instead. Thanks for reading, follow us for more.