| Alert Name: India, Bullish Alert Criteria: Stocks (Any Indian Exchange); Price at least 30.00 and above the 200-day moving average; Volume at least 10,000; Classic Patterns; Bullish; Pattern Duration at least 25 days; Possible Price Move of at least 10%. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Alert Name: India, Bearish Alert Criteria: Stocks (Any Indian Exchange); Price at least 50.00 and below the 200-day moving average; Volume at least 10,000; Classic Patterns; Bearish; Pattern Duration at least 25 days; Possible Price Move of at least 10%. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Alert Criteria: Stocks (Any Indian Exchange); Price at least 5.00; Classic Patterns; Bearish; Daily Events; Pattern Duration at least 25 days. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sensex Technical View :
Sensex has made a low around 11500 which is close to the support zone on the lower side of the channel. The channel is roughly around 11200-11500 as shown in the chart few days back. Technically the indices are in oversold zones , channel support and ideally should give a bounce back in near term. Also as seen previously markets have given sharp bounce backs after 27-29 % erosion in prices and we are almost getting into that area. Shorting should be avoided near to 11200 roundabouts and one can look to buy 3800/3900 calls as pure risk on dips to those levels .
Market Observations and Thoughts :
Its very difficult to stay composed in such conditions for a trader or investor but the only way to invest in these markets is to go staggered /slow in small lots and continue to maintain decent cash levels too even when things look so cheap, undervalued and tempting levels. Although technically the best way to buy is only on a turnaround and which may take a lot of time to come and value investing is a different story altogether and much more difficult too in current conditions.
As a matter of discipline investors should not commit more then 50-60 % even at 11200-11500 so that risk is lesser and decent cash levels could be utilized in panis or in a comfortable environment. Buying should be done 10-15% of intended qty at one price and then buy on further 10% falls in particular stocks.
Randomn Thoughts :
RBI,SEBI,FED,SEC all the policy makers are suddenly coming out with statements about liquidity concerns and measures. In the real terms its more of a reactionary measure then a precautionary one which doesnot help much.
Although the measures would have led to 5 % jump in seconds in better times are now suddenly seeing the news being sold into. Well coz majority of the measures are not to boost the money markets but to stop them from causing more damage.
I would expect CRR cuts followed by a repo rate cut soon . Fed may start cutting rate with an adhoc one possibly but it may be too late. Financial markets are under-pressure not because companies are going bust but the money and liquidity is not present so things may take much time to settle and consolidate. Suddenly inflation,crude, commodity,food is out of the picture ! as now its more of a financial mess!! and less of macro-economics. The month of October would be very crucial as lot of economic policy decisions may be taken !!.
Dow Jones :
Although the index made an interesting pullback from 9500 levels and giving a decent close but has not complemented the move in the next session. Technically 9500-9800 levels are important for the index as below which the supports and retracements are quite deeper. Also the index is highly volatile so one needs to see a confirmed closing before one can look for more indications.
Stocks to watchout for :
Axis Bank : The stock has been range bound between 650 -725 a break below 650 on closing basis could lead to a quick fall to 600.
Stocks which are highly oversold and can be accumulated on further 5 % dips for a bounce back. Only quick traders can make use of it though
Aban Lloyd .
NIIT ............. ( seems highly oversold and some qty can be taken with a medium term view )
Sterlite Inds ..
Till we see a close above 3729( A VERY IMP LEVEL FOR ANY TREND REVERSAL),
nifty will always be in a danger to fall more and more.
in my chart, if u notice a black line, thts the last hope for markets which crosses around 3515 fut levels.
hopefully this will hold, else 3400 can come very easily.
for intraday, breaking 3515, we may see 3474-3426 levels.
crossing above 3654, nifty may hit 3729 levels.
still taking a positional view will be very difficult on the markets as all SL will be very far off.
So try and trade intraday, and avoid carrying any positions
NIfty CMP : 4606.6
If you clearly notices todays closing in nifty then you could spot the formation of a long legged
doji on close. Generally Doji indicates a reversal or an indecesiveness signal and also the formation of doji near lower
band of the bollinger band is a bullish one too. Two case of doji Bullish trend reversal
would be possible if this doji is to be a bullish one.
1) Bullish Abandoned Baby - http://www.fxwords.com/b/bullish-abandoned-baby-candlestick.html
2) Bullish Morning Start - http://www.fxwords.com/b/bullish-morning-doji-star-candlestick.html
If this to be a bullish doji then tommorow's close should be exactly above half of yesterdays candle's Body i.e ( 3817 - 3602 )/2 = 215/2 = +107.5 Pts
Simply Tomorows Close should be above +107.5 pts So resistance exactly near3
I have been getting several questions of this type
- what should be my buying strategy ?
- Should I buy immediately or wait for the bottom?
- Is the price of stock ABC good for buying or should I wait?
I have very simple approach and answer to all the above questions (from my perspective)
Step 1: understand the company well. Have confidence on your analysis
Step 2: Evaluate intrinsic value. Be realisitic in your evaluation. Be neither too pessimistic or too optimistic
Step 3: check price. If selling below intrinsic value (I personally prefer 50% below intrinsic value, you can choose your own number), buy. Otherwise do nothing
Step 4 : Every quarter analyse the results of the company and check if your assumptions are still valid. Recalculate intrinsic value if required.
Personally I decide on the position size and then invest around 40-50% of the full position if the price meets my criteria in step3. The rest of the buying is done in the next couple of months.
This approach cuts both ways. In a rising market, I am unable to build a full position. In a bear market, I am able to average down on price. However while I am doing this I am not looking at the overall market levels or trying bottom fishing. I personally think bottom fishing is a futile exercise and a 5-10% difference in the price will not matter in the long run. If it does, then one is cutting it real close
Do not invest
There is caveat to the above suggestion. If you do not understand the company well, cannot evaluate the intrinsic value or do not have confidence on your analysis, please don’t invest. A bull market is forgiving and you may make money inspite of poor analysis. However a bear market is brutal. If you analyse a company incorrectly or do not have the confidence, the market will not bail you out.
Finally, if you ask for the all time best strategy – Create an SIP (systematic investment plan) on the index for the next 15 years and don’t disturb it.
What I am looking at now?
The market is moving pretty fast these days. As a result I have been reviewing my holdings and looking at new companies. As I plan to keep the total number of holdings fixed (more on that later), I am comparing new ideas with the exisiting ones. A new idea has to be more attractive than an exisiting one, to get into the portfolio (and push out the less attractive stock)
Some companies I am looking at
Lakshmi machine works
Ingersoll rand
ICSA (later)
SKF bearing
HTMT global (cash bargain)
Denso india
Sonata software
Torrent software
The above list is not a recommendation list. It is just a list of stocks I am looking at and may or may not invest in any one of them. I will post on stocks which I find attractive when I complete the analysis and am able to write a post on it.
Nifty :: Again an indecisive bar. Try to hold support but unable to hold at higher level. Watch two strong channel bottom support at 3498/3474, below it next strong support at 3416 and support zone 3320 to 3230.. Our strategy for 8th Oct. Sell at high buy on dip.. Avoid short sell at lower level.. Resistance for up move at 3644/3662/3715/3732/3744/ 3844.. (In Sensex major support at 11135 & 10000)
It's been ages since I drew trendlines. So before I forget how to draw, here is the Sensex daily chart with trendlines. 9000 looks cool and easy here and that is where this whole thing started off anyway, so let's go back and see how 21 k looks from there !
There is only one word which works in this market - sell !
The Indian market opened positive note but not able to sustain at higher level and fell deep in red zone it was choppy session and made new low of 3537 levels and managed to close in green zone. For coming session nifty cross 3730 it can test 3819levels on lower side 3524 will act support zone RSI showing some divergence on chart for upside .
BUY NTPCABOVE 177 TGT 181>183 STOPLOSS 175
1. As a strategy one can buy ONGC near the levels of 1001 with stop loss as 984 for target of Rs 1065-1095.
2. Karvy Stock Broking has reaffirmed its rating for Infosys Technologies as a buy candidate with a target of Rs 2,000.
3. Trade cautiously in Reliance now as it can show technical bounce back any day and thus sellers will be trapped.
4. One can assess Indian stock tip for for Tata steel
Attached above is the 30 minutes chart of the Nifty. The daily chart is not shown here but it has already been mentioned that today’s candle was a doji. A doji, after a downtrend, represents indecision and confusion and indicates that there may be a short term increase in the prices. In the chart above there are two trendlines drawn. The steeper trendline, suggests a resistance near 3630 levels. If this level is crossed decisively, then we could see it go to the next resistance, as shown by the longer trendline, close to 3850. Since the trendline is sloping downwards, every new candle will keep bringing the resistance closer. Support comes near the brown line near 3540. A move below this level would not give us any support before 3130 levels. As suggested yesterday, that is the next support level but the market, being the supreme being that it is, may find a new support before 3130 wherever it chooses. Also shown on the chart is the Moving Average Convergence Divergence (MACD), which gave us a buy signal early in the morning today and continued to remain positive throughout the day.
The Indian market opened positive note but not able to sustain at higher level and fell deep in red zone it was choppy session and made new low of 3537 levels and managed to close in green zone. For coming session nifty cross 3730 it can test 3819levels on lower side 3524 will act support zone RSI showing some divergence on chart for upside .
BUY NTPCABOVE 177 TGT 181>183 STOPLOSS 1751. As a strategy one can buy ONGC near the levels of 1001 with stop loss as 984 for target of Rs 1065-1095.
2. Karvy Stock Broking has reaffirmed its rating for Infosys Technologies as a buy candidate with a target of Rs 2,000.
3. Trade cautiously in Reliance now as it can show technical bounce back any day and thus sellers will be trapped.
4. One can assess Indian stock tip for for Tata steel
Today’s movement in the Nifty was not totally unexpected. It was to be expected that the P-notes issue being eased and the CRR slash would lend a helping hand to the Nifty, which did happen because the Nifty opened with an upward gap of about 125 points. But the overall sentiment being negative, it was also to be expected that the market would eventually lose its way and come down, and that also did happen because at one point during the day the Nifty was down by as much as 50 points. But a final surge that lasted about an hour and a half took the Nifty back up to make it close with a gain of 4 points, thus making a doji for the day. (A doji, as explained in all previous newsletters, is a day where the opening price and the closing price is the same or is very close to each other. Such a candle has a non existent body but has a lower shadow and an upper shadow, the exception being gravestone dojis and dragonfly dojis where one of the shadows is also missing.) The BSE Sensex, not having the luxury of having 50 stocks in its composition and not having gainers like National Aluminium, Reliance Power, SAIL, Tata Communications and Zee Entertainment, closed about 106 points in the red.
World markets continue to be negative. Asian markets remained weak, European markets were, more or less, flat but the American and Latin American markets continue to trouble us. The Dow Jones, at the time of writing, was trading 290 points in the red while the Nasdaq Composite was almost 75 points down. Crude oil was trading at almost the same levels - $88 a barrel while the rupee versus the dollar is now touching almost 48. Gold continued to remain good – after a jump of $33 an ounce yesterday, it has gained another $24 today, obviously as demand for a safe haven increased and on speculation that the central banks may slash interest rates.
World markets continue to be negative. Asian markets remained weak, European markets were, more or less, flat but the American and Latin American markets continue to trouble us. The Dow Jones, at the time of writing, was trading 290 points in the red while the Nasdaq Composite was almost 75 points down. Crude oil was trading at almost the same levels - $88 a barrel while the rupee versus the dollar is now touching almost 48. Gold continued to remain good – after a jump of $33 an ounce yesterday, it has gained another $24 today, obviously as demand for a safe haven increased and on speculation that the central banks may slash interest rates.
Attached above is the 30 minutes chart of the Nifty. The daily chart is not shown here but it has already been mentioned that today’s candle was a doji. A doji, after a downtrend, represents indecision and confusion and indicates that there may be a short term increase in the prices. In the chart above there are two trendlines drawn. The steeper trendline, suggests a resistance near 3630 levels. If this level is crossed decisively, then we could see it go to the next resistance, as shown by the longer trendline, close to 3850. Since the trendline is sloping downwards, every new candle will keep bringing the resistance closer. Support comes near the brown line near 3540. A move below this level would not give us any support before 3130 levels. As suggested yesterday, that is the next support level but the market, being the supreme being that it is, may find a new support before 3130 wherever it chooses. Also shown on the chart is the Moving Average Convergence Divergence (MACD), which gave us a buy signal early in the morning today and continued to remain positive throughout the day.
Ranbaxy looks to have made a nice bottom near 240 and has bounced
multiple times from there,A nice corrective rally is not ruled out
in Ranbaxy if it continues to hold 240 in coming days
Upside targets can be 280,300 respectively.
Regards
Hello friends,
Here in this post I have tried my best resources to simplify
the notorious ELLIOTT WAVE,Which many traders don't even try to learn for one basic reason ,They say its "Complex".Hope this read will help them to grasp the basic trading strategies used with each wave.
WAVE STRUCTURE
TRADING WAVE 1
TRADING WAVE 2
TRADING WAVE 3
TRADING WAVE 4
TRADING WAVE 5
TRADING WAVE A
TRADING WAVE B
TRADING WAVE C
Hope you all find this use full.
Regards
multiple times from there,A nice corrective rally is not ruled out
in Ranbaxy if it continues to hold 240 in coming days
Upside targets can be 280,300 respectively.
Regards
Hello friends,
Here in this post I have tried my best resources to simplify
the notorious ELLIOTT WAVE,Which many traders don't even try to learn for one basic reason ,They say its "Complex".Hope this read will help them to grasp the basic trading strategies used with each wave.
WAVE STRUCTURE
TRADING WAVE 1
TRADING WAVE 2
TRADING WAVE 3
TRADING WAVE 4
TRADING WAVE 5
TRADING WAVE A
TRADING WAVE B
TRADING WAVE C
Hope you all find this use full.
Regards
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