Nifty for 11 Apr 08

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 can be seen, the down sloping trendline has been retested. The normal weekend profit booking did pull the index down a bit. On the whole the bulls should be satisfied as we have seen a normal bullish day.

The Index is still struggling to break out from the congestion zone, even though the sentiment is turning mildly bullish after this fortnight.

The suggested stops for yesterday have still held, and the short term trend still seems bullish.

I can only repeat myself on what I have been saying all week. I would still retain my declared stance for the market. I would wait to see the short term tops of ~4800, ~4900 and ~4980 to be unequivocally violated, and then declare myself as a wholesale bull. Till then I would remain a cautious hedged bull.

Short term traders may retain their stops at ~4627. Long term traders may also retain their stops at 4627.

Next week is going to be a very short trading week. We may see some heightened volatility. But the trend is still expected to remain bullish.

Trade happy after planning your trade.

Nifty for 10 Apr 08

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.

Another volatile intraday trading day. The high for today has hit the down sloping trendline bang on as can be seen from the chart. The previous bottom is still holding and we can see the extreme short term trendline inching up.

The suggested stops for yesterday have still held, and the short term trend still seems bullish.

From today’s price movement, it does seem that the market is pausing at the right places and behaving in a technically correct way. The efforts to turn to positive sentiment still seem on. If or when, the short term down sloping trendline is also violated to the upside, it would be a point in favour of the bulls.

It is expected that the whole of April will be a period of consolidation with more traders coming back to the market after some bullish confidence is restored.

I would still retain my declared stance for the market. I would wait to see the short term tops of ~4800, ~4900 and ~4980 to be unequivocally violated, and then declare myself as a wholesale bull. Till then I would remain a cautious hedged bull.

Short term traders may retain their stops at ~4627. Long term traders may also retain their stops at 4627.

Trade happy after planning your trade.

Nifty for 09 Apr 08

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.

Quite a volatile day on the intraday chart. The previous bottom is still holding and we can see the extreme short term trendline inching up.

The suggested stops for yesterday have still held.

Though the market has not done something spectacular, it is heartening to see that it is indeed making efforts to turn to positive sentiment. If the short term down sloping trendline is also violated to the upside, it would be a point in favour of the bulls.

It is expected that the whole of April will be a period of consolidation with more traders coming back to the market after some bullish confidence is restored.

I would still retain my declared stance for the market. I would wait to see the short term tops of ~4800, ~4900 and ~4980 to be unequivocally violated, and then declare myself as a wholesale bull. Till then I would remain a cautious hedged bull.

Short term traders may retain their stops at ~4627. Long term traders may also retain their stops at 4627.

Trade happy after planning your trade.

Nifty for 08 Apr 08

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.

Even with a mildly bearish day the market does seem to have made a significant short term bottom on Monday.

In technical terms, today was a nothing day. The suggested stops for yesterday have still held.

Looking at the negative aspects first, if the stops suggested for yesterday are violated, then we may see extended bearishness. The previous swing bottom of 4468 may be tested.

Now looking at the positive aspects. The previous swing tops still to be violated. I would wait to see the short term tops of ~4800, ~4900 and ~4980 to be unequivocally violated, and then declare myself as a wholesale bull. Till then I would remain a cautious hedged bull.

Short term traders may keep their stops at ~4627. Long term traders may also retain their stops at 4627.

Trade happy after planning your trade.

Nifty for 07 Apr 08

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 was suggested on Friday that … “the Index must make a short term bottom around Monday or Tuesday and should not violate 4468. If it does, then we may assume another extended period of bearishness”.

After today’s price move it does seem that the market does not seem to want to give up its gains of the last two weeks.

From the market action today, it does seem that this is a significant short term bottom.

Short term traders may keep their stops at ~4627. Long term traders may also raise their stops to 4627.

Trade happy after planning your trade.

Nifty for 04 Apr 08

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.

We had another week of constant bad news from the USA. As a result of which the market is mainly bearish. The trend for the short term still seems to be up, but is now in the danger of breaking down.

The Index must make a short term bottom around Monday or Tuesday and should not violate 4468. If it does, then we may assume another extended period of bearishness.

From the face of it, the market does not seem to want to give up its gains of the last two weeks.

That is because the previous swing bottom of 4628 is intact. From the short term perspective, if 4628 is violated, then we could watch 4468.

Long term traders may continue their stops at 4460.

Trade happy after planning your trade.

Nifty for 02 Apr 08

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.

The market was open to wide manipulation, due to the thin volumes happening. It was expected, after the rush of huge intraday volatility in the last month, that things would calm down relatively. It seems that the market is out to prove me wrong on this count too.

Anyway, from the cursory glance of the chart of last week, we see that every major rise is being met with selling. At present the bears seem to have the stronger hand. But please keep in mind that it is very simple to manipulate the market with low volumes.

The downside violation of the horizontal red line around the 4720 level is weighing in favour of the bears. The rising red line is weighing in favour of the bulls. Where does it leave the small trader? In the zone of uncertainty. The previous swing top of 4971 has still not been violated on the upside. So also, the previous swing bottom of 4628 is intact.

From such a long discourse, what is the capsule? Stay out when uncertain.

For those readers who still have open positions, I can suggest only one thing … Just adhere to the stops.

Long term traders may continue their stops at 4460. Short term traders may watch 4538.

Trade happy after planning your trade.

Nifty for 31 Mar 08

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 as if the market has overheard my comments of Friday…. “There is no certainty in the market, or else I would have said slowly but surely”.

With a slew of negative news emanating from the USA, we see the sentiment getting fractured badly. And it seems that there is going to be even worse news tomorrow.

Which allows bulls among us to be prepared for more pain tomorrow? Quite possibly. In fact, from the movement of last week, it did seem that the market was finally shrugging off the USA news flows, but it seems I was wrong.

Which leads us to the importance of the stops. It is suggested to take nothing for granted. Just adhere to the stops.

Long term traders may continue their stops at 4460. Short term traders may also watch 4538.

Trade happy after planning your trade.

Nifty for 28 Mar 08

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 was suggested for the whole of this week, the Nifty indeed seems to be on a sound footing now. The trend seems to be heading up now, slowly. There is no certainty in the market, or else I would have said slowly but surely.

The only apprehension I have at this stage is that volumes are not too heavy. I would have felt much more comfortable had we seen rising volumes but I assume that it is because of the P Notes issue.

These are just a few fundamental thoughts. Capital inflows do not seem as buoyant as earlier, and no fresh inflows. The news is out and known to all. So the market is reacting now purely on technicals, and has factored in this news.

Till the time this P-Note issue is weaned out of the market, the market may not react to it. Unless, of course, the Government reconsiders its decision on winding up of the P-Notes.

Long term traders may now place stops at 4460. Short term traders may monitor 4538.

Trade happy after planning your trade.

Nifty for 27 Mar 08

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 nothing much to write home about. It was a day of consolidation. After today, it may be expected that the Nifty resumes its short term trend upwards.

The levels were mentioned yesterday, so it makes no sense to repeat them.

From tomorrow onwards, it could be expected that the Nifty makes a normal move for the whole of April, without the volatility of the last two months.

Trade happy after planning your trade.

Nifty for 26 Mar 08

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.

The breakout from the short term downward sloping channel is still holding.

As was suggested yesterday, we may see a profit booking day after such a huge rise of yesterday. It should be encouraging for bulls that the breakout from the down sloping channel is still holding.

For tomorrow, we should monitor the ~4718 level for a possible sign of weakness. The next level would be ~4530. If that too does not hold, look for ~4470. Now for some explanations. The ~4718 level should hold in case this short term move is to sustain. If ~4530 does not hold, then we should have the alarm bells ringing. If ~4470 does not hold, then short term traders may look for the longer term trend.

And, as we have already been reading constantly, the intermediate term decider may be placed at ~4440.

Trade happy after planning your trade.

Nifty for 25 Mar 08

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.

For reasons beyond my control, I could not upload this yesterday. For whatever it is worth, I am doing it today, to provide continuity to my regular readers.

Has the market surprised me? Yes I would say. It was anticipated that the up move would come around the expiration date. But it seems to have started at least two days in advance.

The market may now try and close this large gap of today, but the bulls may try and not allow that to happen. In any case, the short term bullish pattern which was suggested has occurred. Now the only condition to be fulfilled is that the previous bottom of ~4468 must not be violated.

As of now, I do not anticipate that even if this short term bullish pattern holds, it would lead to great things. We may see a good up move, but I expect the bears to regroup around the 5400 levels once again.

Once this whole cycle of news driven knee jerk reactions are out of the way, we may see a relatively smooth move for the month of April.

Trade happy after planning your trade.

Nifty for 24 Mar 08

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.

Bulls, keep holding your breath. The previous bottom is still holding. As suggested last week and as was anticipated, we did see a bounce, but was met with immediate selling.

I did make a mistake in my musings last week, calling Monday as tomorrow.

Again, as stated last week, I reiterate that this up move may be viewed with a little scepticism, and not much weight may be placed on today’s gap up move.

For a short term bullish pattern, the Nifty must violate the swing peak of ~4716. The previous bottom of ~4468 must not be violated. As of now, I do not anticipate that even if this short term bullish pattern holds, it would lead to great things.

We have entered the last week of the derivatives cycle. Therefore, I do anticipate this week to be choppy.

I was asked a question, what I meant by stops being run, at the end of this cycle. It simply means that depending on the technical overweight positions, whether bullish or bearish, the opposite camps will attempt to run each other’s stops. As of now, the bears seem to be overweight, so it may be expected that the bulls will run the stops of the bears, and drive them out. Then we may see a relatively smooth move for the month of April.

Trade happy after planning your trade.

Nifty for 19 Mar 08

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.

Bulls, hold your breath. The previous bottom is still holding.

The indices are attempting to make a short term bullish pattern. But have still not been able to. As is the norm nowadays, the Index opened with a gap, and then traded as it wished.

The sentiment is still not positive. We may see a bounce back up tomorrow, but it may be viewed with scepticism.

Tomorrow is the weekend.

Another reason why this move may be viewed with scepticism is that the Nifty Future seemed more bullish than the Nifty Index. All said and done, the Nifty Future is a derived trading product based on the Nifty Index.

It is my guess that the market may run stops near the derivatives expiry next week, and that could be a decisive bottom.

Therefore, it makes no sense to suggest trading levels for tomorrow either.

Trade happy after planning your trade.

Nifty for 17 Mar 08

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 was mentioned a few days back, we see there is a divergence between the BSE and the NSE Indices. The Sensex has already violated the previous panic swing bottom, whereas the Nifty is still holding out.

This brings us to the ultimate question. Which is more reliable? The Sensex or the Nifty! This simple question cannot be answered in a simple sentence. However, I will try.

The Sensex has more followers because of its age. However, the Nifty is more accurate because of its trading. The Nifty Future is traded reflecting the NSE Index, and therefore, I would place more reliability on the Nifty rather than the Sensex.

In any case, whether the Sensex or the Nifty, the sentiment is really fractured, as of now. On both the indices, we do not see any meaningful move, which can allow us to conclude that the short term trend is changing to up.

If the short term trend does not change to up, so will the intermediate trend also remain flat.

Therefore, for bulls, I can only suggest patience. I am still of the opinion that the market could swing from here. I may be wrong, as I have been wrong several times earlier. The market is so oversold, that something has to break. We could see a move up. And this anticipated move may be viewed by the so-called extinct bears of the Indian Stock Market as an opportunity to return. How strong will the bulls be? That remains to be seen.

But I know only one thing about the market, and that is a true age old adage. It takes a lot of money to push the market up because it needs real money to buy, whereas the market can collapse on its own weight because it does not need money to sell. Buy when there is “blood on the streets”.

Trade happy after planning your trade.

Nifty for 14 Feb 08

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.

The chart says it all. This last downswing has been not as large as the previous down moves. Further, on a short term basis, we see a parallel channel moving down. This time the down swing has avoided the downward blue line.

There can be one simple reason for that. That today is a weekend, and normally short positions are unwound to avoid news based volatility over the weekend.

On the other hand, today we see some positive change in sentiment. Normally I would be very enthusiastic with a positive change in sentiment. But for the last few weeks, the market has flattered to deceive.

Today is actually a bottom fishing paradise. If there are some gutsy short term traders reading this, I may be inclined to encourage it. However, for the more conservative, I would suggest waiting for the ~4900 levels to be violated on the upside. For the cautious traders, it may be suggested that we allow the ~5020 levels to be violated and then buy on a dip.

In any case, we could trade with a stop loss at 4560.

Trade happy after planning your trade.

Nifty for 13 Mar 08

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.

Another level gone. Another one bites the dust.

I have been warning about the high expected volatility for almost two weeks. This type of volatility normally kills the small trader.

The BSE and NSE are not working in tandem now. On the NSE Nifty, I am getting an expected downside of ~4370 whereas according to the same measure the BSE Sensex was expected to achieve ~15400, which has already been breached.

All said and done, the chart shows a battle scarred minefield of upside and downside gaps, which suggest one thing loud and clear. There is no trend, and when there is no trend, it makes no sense to risk capital and play with fire.

It makes no sense saying that the market is deeply oversold. That does not prevent it from becoming more oversold. However, from all indications, the way Puts on the Nifty are so highly overpriced, something must give away.

I would still suggest long term traders to keep a watch for the ~4450 levels.

Also please keep in mind, that the whole of this month is expected to be violently volatile.

Trade happy after planning your trade.

Nifty for 12 Mar 08

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.

The market traded exactly as expected. However, the time frame of a few days, which I had anticipated for the bears to get back in action was wrong. The market seems to be so fast and compressed these days.

I suppose it is because of the plethora of information available on the media as well as the internet.

Anyway, from a technical point of view, we see a short term bullish pattern developing. The previous swing top of ~4935 has been violated. Short term traders could now take buy positions on dips, with a strict trailing stop at 4620. I expect the support to come around the 4770 levels.

If the previous swing bottom of 4620 is broken, then it would mean that the bears are stronger than the bulls, and that the bulls would better stay sidelined till the big boys start buying.

I would still suggest long term traders to keep a watch for the ~4450 levels.

Also please keep in mind, that the whole of this month is expected to be violently volatile.

Trade happy after planning your trade.

Nifty for 11 Mar 08

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.

From the pattern on the chart, the bounce of the last two days seems like an upward correction to the fall of the last fortnight, from ~5350 to ~4600.

It is exactly this type of pattern which allows bulls to trap bears to scurry to cover their shorts. Therefore, in all probability, we may see a gap up opening, which could trip the stops of bears around the 4950 regions, which was the previous short term top.

It would remain to be seen how the trading goes today. If the bulls are stronger than bears, we could see a sharp recovery. After a few days, we could see a renewed bear attack, as there are several resistance levels overhead.

The strongest resistance level is the black box ~5400. Thus, we may see some downside correction from there. In all probability, this correction would be the downside correction, which could be used by sidelined bulls to re-enter the market.

Trade happy after planning your trade.

Nifty for 10 Mar 08

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 the market seems to have tested the previous bottom of 4450. It almost seems to have scraped the bottom.

From the microscopic short term perspective, we see something positive. It has made a higher top from its immediately previous swing top of 4797. However, please no not read too much into this. The pattern of the chart has still not shown a convincing bottom. For the market to return to its short term up trend, the top of 4815 must be broken on the upside, and the low of 4620 must not be violated.

On Friday, we had a longer lower shadow on the daily candle. Today’s longer lower shadow seems to have more significance than that of Friday. Both on the BSE as well as the NSE, the moves seem to have been positive. Further, both the exchanges show white bodied candles. Bulls would not be advised to break open the champagne bottles as yet. Allow the sentiment to ferment for a few days more and allow the negative sentiment to change to positive. Then only would it make sense to say firmly, that today was indeed a significant bottom.

Trade happy after planning your trade.