Nifty for 05 Oct 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.

Today was a weak day. But so far, the Nifty is still displaying a consolidation pattern, without any signs of breaking down. However, we still see signs of profit booking in lower rung stocks, with the index heavyweights propping it up. Therefore, it is suggested to trade with caution in the second and third rung stocks.

The target of around 5400 is still open, and quite possible, we may not see it achieved in a hurry.

The market seems to be throwing all the “rules” out of the window as of now. All I can deduce from a longer term perspective, that there is a HUGE amount of steam left in the Indian stock market. I detest making predictions, but I can confidently say that this short term top which could occur or already has occurred around ~5250 is not the ultimate peak.

Plan your trade and trade happy. Suggested to keep the trailing stops intact, and enjoy the ride.

Nifty for 04 Oct 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.

At last the Nifty has broken its track record of making new highs everyday. As of the last two trading sessions, it seems to be a short term consolidation pattern.

I can only repeat what I mentioned yesterday. “The chart shows our next expected frontier. Will it or won’t it? No point speculating on this question. That will not earn us money.”

Today was a negative day on the Nifty, but not very significant. However, the only really negative thing which I observe is that the Nifty Futures are priced higher than the Nifty spot.

As we know, there should be a cost of carry for the Future, as the market is financing you to buy a virtual position. This should keep the Future priced higher. We have noticed that, usually, at market bottoms, the sentiment is depressed and the difference between the Cash and the Futures is high, with the Futures being lower priced. The reverse is true at market tops.

At present the difference is not much. However, this would lead to a perfect arbitrage situation, where the larger players could buy the Nifty Components and sell the Future to earn a risk free profit.

We also see a few cycles in time falling between 8 and 11 October. It seems that the attitude now should be of caution.

Plan your trade and trade happy. Suggested to keep the trailing stops intact, and enjoy the ride.

Nifty for 03 Oct 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.

How boring … another new top. Today, the Nifty moved out of two short term projections with a gap. There was expected profit booking, and a convincing recovery too.

The chart shows our next expected frontier. Will it or won’t it? No point speculating on this question. That will not earn us money. A simple strategy of keeping trailing stops has earned us another ~150 points on the Nifty.

It was suggested on Monday that the Nifty has bounced twice from our earlier blue line/green zone, which was another short term projection. It was stated that this makes the green zone a significant one. Oh well, the Nifty did respect that level, and the result is there for us to see.

Plan your trade and trade happy. It is again suggested to keep the trailing stops intact, and enjoy the ride.

Nifty for 01 Oct 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.

Do spend a moment remembering the twentieth century icon of non-violence.

How boring … another new top. The Nifty has almost kissed our projected black line.

It is also noticed that the Nifty has bounced twice from our earlier blue line/green zone, which was another short term projection. This makes the green zone a significant one. Keep a sharp eye out for it in later days.

Apart from that, there is not much change from yesterday. The short term trend is still up. Our strategy of raising our profit booking stops has just given us an additional half percent on the Nifty.

Plan your trade and trade happy. It is again suggested to keep the trailing stops intact, and enjoy the ride.

Nifty for 28 Sep 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.

There is not much change from yesterday. The target zone is still open. The minute short term trend is still up. Our strategy of raising our profit booking stops has just given us an additional few points on the Nifty.

There was a question about the long term trend of the mother of all worldwide indices – the Dow Jones Industrial Average. This monthly chart was prepared sometime about three years back, and none of the studies have been changed. The time and price nexus is still standing the test of history, and we can expect it to do so in future too.

Most traders get so caught up watching the intraday charts, that they forget there is also a longer term aspect to trading.

I have oft repeated that a miniscule minority of traders can catch the top range and the bottom range. Otherwise, the exercise of trying to predict is a luxury most traders cannot afford and should not indulge in.

Even now, the Dow is not showing a final peaked out pattern as yet. And as we all know, all is not well with the USA economy.

Similarly, we do not see a peaking pattern on the Indian indices as well. So where is the need to panic?

What more can I add except, plan your trade and trade happy. It is suggested to keep the trailing stops intact, and enjoy the ride.