Republic Day Greetings

Nifty for 24 Jan 07

These are my personal musings. These are not in any way meant to be trading advise. To view the full chart, right click and open in a new window.

Wednesday was expected to be a weak day, but the sideways movement continued. As can be seen from the chart, in the last few days, we have seen gap openings which are contributing to the fear factor among short term traders. Intermediate and longer term traders would be insulated from these gyrations.

The Index was looking to make a rough head and shoulders pattern till Tuesday. Today, it has not yet confirmed that pattern. If it does not convincingly break down, the trend can actually reverse to up.

The short term trend is giving mixed signals, but the intermediate term and long term trends are still up. In fact, today i.e. Wednesday, the short term trend seems to be indicating to turn up. The short term bullish pattern which could confirm the bottoming of the Index may occur on Thursday.

The main reason for the short term downtrend was the Bank Nifty, which also seems to have turned upward. Complacency is not an option during trading, and this volatility can be attributed to the derivatives expiry on Thursday.

Trade happy.

Nifty for 23 Jan 07

These are my personal musings. These are not in any way meant to be trading advise. To view the full chart, right click and open in a new window.

As suggested, Tuesday was another weak day.

The Nifty seems to be making a rough head and shoulders pattern, which could allow it to correct to 3970. It is a rough estimate. That would mean that the previous tops may be penetrated mildly. That could set off some triggers for bulls, who have been holding long positions, with 4030 as a stop.

The short term trend is assumed to be continuing down, and the intermediate term and long term trends are still up. Sharp dips may still be used to enter buy positions. However, please remember to allow a bullish pattern to confirm a bottoming of the Index.

The main culprit for this short term downtrend is the Bank Nifty, which is showing greater weakness than other Indices. As soon as we see support on this Index, we could see some other sector being distributed. This sector churn could allow the weakness to continue for a few more days.

Trade happy.

Nifty for 22 Jan 07

These are my personal musings. These are not in any way meant to be trading advise. To view the full chart, right click and open in a new window.

Monday was another rather boring day for traders looking for excitement.

Do we think the correction is over? Well, I still do not think so. I think that the Nifty could correct down to 4020.

The short term trend was assumed down, and the intermediate term and long term trends are still up. Dips may still be used to enter buy positions.

Trade happy.

Nifty for 19 Jan 07

These are my personal musings. These are not in any way meant to be trading advise. To view the full chart, right click and open in a new window.

It is really a case of so near yet so far. The Nifty stopped just 30 odd points from a projection. Normally, when we see profit booking at such a high level, and then see a lower low than the past few days, we could assume that the short term trend has turned down.

It was expected that the Nifty would start correcting on Wednesday or Thursday. It seems a day later than what we had expected. This suggests that the long term trend is still intact, and this can only be labelled as a correction. Till we see any evidence to the contrary.

On Friday, the volatility in the Nifty could have scared even the die hard traders.

The short term trend is assumed down, and the intermediate term and long term trends are still up. Dips may still be used to enter buy positions.

Trade happy.

On 11 January, (Click here!) I had shown a chart with a bullish set up.

Today I am showing a chart with a bearish set up.

This week, we had been expecting a short term decline, and here is how we could have remained alert for such an occurrence. As has been suggested earlier, look for the evidence, on any time frame, be it hourly, daily weekly or monthly.