Nifty Analysis for 26 Sept 06

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 Nifty did give us a scare, and for some time, it seemed that our objective of 3570, mentioned in my analysis of 18 Sep 06, and again on Friday, will not be achieved.
Normally, a target is overshot, and this time, the Nifty has come out of a two day sideways consolidation pattern. Therefore, in all probability, this time too, the target of 3570 will be overshot handsomely.
After all, the 3610 target is not far away. And the way the Nifty is behaving, it looks like even this 3610 target will be overshot handsomely.
Obviously it may not be one way. But brace yourself for a nice ride.

Nifty for 12 Jul 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.

What more can a person say that the Nifty is behaving perfectly, technically. A gap up open should hearten bulls, who are waiting for the ~4465 potential target for the Nifty.

The results season is now starting and as can be expected there would be intraday volatility.

The total traded volumes are also rising. In fact, we may see the potential target achieved within a few trading sessions. It is noticed that the market tends to pause at these types of potential targets. Further, the cycle in time falling on 17 July, which has been mentioned earlier too, also is fast approaching. It is now the time to be cautious.

Technically the position now changes … the suggestion to buy on dips would remain valid only for very short term traders. Others may tighten stops and allow the market to exit us from the winning positions.

Plan your trades and trade happy.

Nifty for 28 Aug 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 has been a long time. I am really gratified that the market respected our cycle in time of around 17~18 August, which was mentioned in my last post on 14 August. According to my cycle calculations, we have another event on 30 August. A kind friend informed me that the Dow is down 135 points, as of this moment when I am writing. In such a case, we could see some downside due to adverse sentiment. If we see a downside, then we could see an intermediate bottom on 30 August.

And, the next time cycle falls on 5 September. This could again show us a short term turning point. In any case, the pattern of higher tops and bottoms augers well for the bull. This may therefore be classified as a buy on dips situation.

The short term target derived from Fibonacci extensions is 16278 on the BSE and 4724 on the NSE. If such a target is achieved, then it is obvious that the market may make a new high.

Plan your trades and trade happy.

Nifty for 24 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.

The next target also seems upon us. It is placed at around 5000. However, it does seem that even this target would be swept aside. As is normally the norm of the market, the targets are exceeded by a bit, so we may see a short term top around 5100.

This calculation is in keeping with the market movements for the last few days.

Was I wrong about the cycle in time? No. As has been often repeated, a cycle in time is just that, a projection of time. A window of a day or two may be granted, as emotions in the stock market cannot be dictated by mathematics.

At this stage, any other suggestion seems redundant; expect to keep tight stops to exit profitable positions.

Shorts? It is again very humbly suggested to avoid them at this stage.

Nifty for 05 Dec 06

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. A new high has again been achieved, once again.
It really is strange, how traders have doubts in their minds when they are holding positions. There is no evidence of any weakness and yet people ask me for my opinion on the market.
The Bank Nifty seems to have taken support, and about to bounce back. As a result, some sector churn could follow, leading to some volatility in the Index.
The technicals still suggest that we could expect a short term target of 4120. The fib extension target posted earlier still holds at 4170.

Nifty for 27 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.

As was suggested yesterday, the simple strategy of keeping a trailing stop keeps us in the market, rather than to exit prematurely. It has given us more than one percent today.

As far as expiration days are concerned, today must be the tamest expiry day in a long time. No fireworks, no flashes, just a continuation of the steady uptrend. The first short term target of 5000 has been achieved today.

The target range between 5000~5100 is still open. It does seem that the historic supply line is now giving support.

Shorts? It is again very humbly suggested to avoid them at this stage. There will be plenty of time to short later, when the market gives us a convincing signal.

Once more, I reiterate my slogan, plan your trade and trade happy.

Nifty for 06 Dec 06

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

A new high looks like becoming a routine.

However, with every new high, profit booking is rearing its head. As a result, we are not seeing any sustained follow through buying. Let the profit booking happen.

For the longer term player, it could be the best possible thing to happen.

The Bank Nifty seems to now have given up its support, and may witness some more weakness. As mentioned earlier, this sector churn could lead to some volatility in the Index.

If we just step back, and see the chart, we do not notice any major weakness in the index, as of now.

The technicals still suggest that we could expect a short term target of 4120. The fib extension target posted earlier still holds at 4170. I would raise my “mental” stop to 3980, from where the Nifty bounced strongly.

Nifty for 27 Nov 06

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 has been quite a while since my last post, well, a shade over two weeks. The Nifty has not done anything which was not expected. Still I wonder how many people have made money in this last fortnight.
In a capsule, the previous historic high has been tested and violated. The expected target was achieved, and has been broken. The last deep correction was a shakeout of the bulls, where the previous top was retested.
Since then, all the patterns are still suggesting of good times to come for the bulls. I have yet to see a mad euphoric blow off rise on the index. This is good for the bull. He can still take advantage of the further expected rise.
We have still not seen a meaningful correction for the last rise, in terms of price. Please keep in mind that a correction does not necessarily need to be in price, but can also been in time.
What do I expect? There could be another foray by the bears this settlement expiry, which could be used by amateurs as an excuse to short. This shorting could cost them dearly, as the bulls still seem extremely strong.
By following the Fibonacci extensions, the next logical target for the Nifty Index falls at 4170.
Will it or won’t it? Let us see.
Till then, trade unemotionally, and keep happy.

Nifty for 06 Aug 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.

When the market constantly breaks downside targets, we re-evaluate the position. With revised calculations, we arrive at a short term target of 4234. The target of 4234 falls just within the grey band which I have been carrying for the past two months. Readers must have got tired of hearing this everyday, but the fact is that the bottom for today is another very significant bottom. If this bottom is broken, and if the grey band below it is violated, on a closing basis, then things could really get ugly for the investor.

The probabilities were higher for the Index to move back up, but even that has failed.

It is a reflection on the current weakness of the market that it took the index almost six weeks for the market to move up from the 4100 to 4650 regions. It has given up almost 60% of its gains in just two weeks.

Normally, we witness buying interest when the price gives up around 62% of gains. So we may again witness bouts of buying from tomorrow. However, we would need to evaluate how strong the buying is to really decide whether the short term trend has indeed changed from down to up.

As far as the longer term perspective is concerned, I can only repeat my suggestion of many days … technically the position remains as a suggestion to buy on dips. Profit taking also may be done quickly, unless we are long term investors.

Plan your trades and trade happy.

Nifty Analysis for 27 Sep 06

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 purists among us will be extremely angry that the Nifty did not achieve the 3610 target. Does not matter. After all, the high was just 7 points away.
I am keeping a trailing stop of 3565 on the Nifty for long positions, as that coincides with two techniques. One is the 3568 intraday low, and the other is the rising trendline. Again people could question me saying that if I am so bullish on the market, then why keep such a tight stop?
Two reasons … one is that my short term target is achieved, and the second is … nothing prevents me from going long again at higher levels. For the present, my prime objective is to lock in my profits.
And take a new look at the Index, once this derivatives settlement is over tomorrow.
I am also marking out the stops which readers could adopt, depending on their own trading styles.

Nifty for 09 May 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 yesterday, “the orange band around the 4970~5000 should now come into play”. It has hit our target bang on. Whether the Index will hold this level or not remains to be seen. Normally, after such a sharp dip, we do see some pull back.

Therefore, we could expect Monday to test the rising blue line, and then make a move up. How strong would it be is anybody’s guess. But short term trader may take advantage of this expected up move. It also goes with without saying to keep stops intact.

This suggestion is akin to bottom fishing, and readers must be tired of hearing me … warning of the hazards of catching a falling knife with open hands.

The chart still shows a steady uptrend, as is apparent by the upwards sloping blue channel. This last down move has been rather sharp, and later we could see selling at higher levels. If we witness strong buying at higher levels, enough to counter profit booking, we could see even higher tops on the Index.

The scenario which I expect on Monday is that the Index could open with a downside gap, and then strong hands may step in to start buying, which could push the Index upwards.

Even now, the suggestion to buy on dips still remains valid. Traders with a longer term horizon could wait for a formation of the short term bullish pattern to enter long positions.

Trade happy after planning your trade.

Nifty for 19 Feb 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.

From a trading perspective, today was a non event. With a flat sideways movement on the Index.

The earlier target at 4170, which was providing support, has turned into a short term resistance. From expectations, it does seem that this short term resistance will be violated on the upside, in due course. When it would be, is a question of uncertainty. Simply because we have a trading event of significant importance coming up on Thursday.

The short term bottom of 14 Feb, also remains significant. So does the gap between 4060 and 4080.

From the behaviour of the Index, we could see the market remaining strong right till the first week of March.

It does not harm to remind readers to please consider trading with caution during the last week of February, due to the expiry of the derivatives settlement and the news flows about the budget.

Nifty for 20 Jun 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 has been quite some time since I posted last. I have had some engagements which prevented me to do an in-depth analysis. It is very apparent from the chart that the trends on all time frames are down. The market does not have enough strength to be able to pierce the previous swing top.

The first question which comes to my mind is … where would it stop? First we take the short term perspective. Taking the Fibonacci calculations into account, we have a probable downside target of 4185. This is based on the last downside leg starting from the swing high of ~5299. Will this be the last of the downside? We cannot be sure of that at the present point in time. Only time will tell whether 4185 would be the bottom or not.

Further, within the months of June and July, we are having cycles in time falling on 21 June, 2 July, 6 July and 21 July. That suggests that this may be a volatile trading period. As the market is deep in oversold zone, I expect a lot of upside retracements, which would attract the attention of profit booking as well as new bears.

The last leg on this journey may attract a lot of shorting, which would trap the bears. Then only would we find the market in a position to resume its long term journey upward. So far we do not see any evidence of fear in bears, and shorting is resulting in sizable profits.

Where does the reader, the ordinary stock market investor enter? It is simple, wait for a base to be made. Let the negative sentiment be weaned out and then make your move.

Now, I present the long term charts of both the Indices.

The last time I posted this simple chart, the Nifty was poised at a very interesting juncture. As of now, the Nifty too has given up any semblance of being able to stand against the bear onslaught.

This weekend, I also present another chart, which I normally use to judge the market condition. This is a simple trend following chart, which I rely on to get the feel of the market.

The trick to successful trading is to determine the trend, and once the trend is in place, to take trades in the direction of the trend. This is the time tested safe strategy to the market.

Unfortunately, 99% of the small traders do not follow this principle. Rather, they try to hunt for the bottoms and sell at the tops. That is where they fail. And who makes money? The sharks.

This brings us back to the short term chart. Has the short term down trend terminated. Not yet. The short term bullish pattern which we normally look for has still not formed.

I find that my observations of the end of last month need not be changed.

We may still have upward corrections for the drop of this month. These upward corrections will attract profit booking as well as bears. Therefore, it is suggested to be nimble footed at this stage. If you do not monitor the market on a daily basis, it is better to stay away.

It is an old saying that “any fool can buy at anytime, he must find a bigger fool to buy later for profit.” Profit in the market is all about timing when to buy. Stay tuned.

Nifty for 08 Jan 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 potential target zone which I have been carrying for the last few days seems just around the corner. Is it going to be a case of so near yet so far?

Today has been a classic case of overall profit booking on most sectors while the IT sector has witnessed buying interest, which is propping up the Index. Today’s move also validates the support zone which has been carried on the earlier charts. Even though today was a weak day, it still does not show a short term bearish bias on the Index. Therefore it would be prudent to stay long with a stop at a closing below 6220.

However, due to the overall profit booking mood, it does seem that we may see a downside correction for a few days. We notice that during the last three months, all the corrections have been shorter in nature than the earlier ones. It may be expected that this overall trend continues. However, please do not initiate any trades on assumptions but on cold hard facts. Look out for a short term bullish pattern before initiating any long trades.

Trade happy after planning your trade.

Nifty for 09 Aug 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.

The pattern on the chart suggests as of now, that the up move in the beginning of this week could be a reaction to the fall of the last two weeks. And as it seems inevitable that there should be a down move which would allow the pattern to complete.

As I have been mentioning for the past few days, the market moves up laboriously and tanks effortlessly. This suggests that the market is in a down move. Further, we notice that the market opens with a downside or upside gap, thus not allowing comfortable trading in the direction of the trend. Today, the market has moved in a huge trading range, missed the grey band and moved back into the yellow band.

From the way the market is behaving, it does seem that the pink zone will not provide enough support. According to the projection of this down move, we get a target of 4238.

Short term traders may possibly buy on dips with a strict stop.

As far as the longer term perspective is concerned … technically the position remains as a suggestion to buy on dips. Investors could now be cautious about the 4235 level. Profit taking also may be done quickly, unless we are really long term investors.

Plan your trades and trade happy.

Nifty for 31 Dec 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 has been quite some time since I last posted. In my last post, it was suggested the market could make a short term top due to the cluster of time cycle between 13 to 16 December. It did.

It was also suggested that an up and down roller coaster could continue till 21 December. It did.

Also, as was suggested, that the “warehousing fever” could start around the last week of this month. It did.

It is reward enough for this humble analyst that readers could have made opportune exits and then re-entries based on my earlier suggestions. Looking ahead, the market is pausing at a previous target which provided resistance earlier too.

The market is now poised delicately. It does seem that the previous top will be broken. How far will it break? This time I do not anticipate a large margin. The anticipated level it could achieve is 6245. After that we could see a correction. Be on guard.

Have a good year ahead. Not a greedy one.

Trade happy after planning your trade.

Nifty for 21 Mar 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.

From the way the Indices have behaved today, it seems that our analysis could stand the test of time. We may see a short term top today or tomorrow, and then we may see some continued volatility till our next time cycle target of 31 March.

Since the short term trend is up, the intermediate trend is undetermined and the long term trend is up, we will see these violent reactions, till the froth settles down. And the probabilities all point to the fact, that the intermediate term trend also could point upwards.

Trade happy.

Nifty for 03 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.

As can be seen, the Nifty is still knocking at the historical supply line. There has been mild penetration of that line but still the Nifty is holding. Today’s candles, both on the BSE and the NSE are uncertain candles. We see some resistance levels around the 4520~4535 levels, which incidentally is also a short term price projection.

Therefore, we possibly could see a gap up open tomorrow, and may see the Nifty achieve that target. Earlier I had mentioned another cycle in time falling on 5 September.

Readers would now be itching to enter the bull run, afraid that it will run out of hand and they may not have an opportunity to buy at a later date. The market is imploring traders to buy at this time. And as we all know, we should buy when we want, and not when the market wants us to.

The main trend is still up, and trades could be placed in the direction of the main trend. The proper course could be to wait for dips to buy. Stops may be placed at the 4220~4230 region where you see the grey support band.

Plan your trades and trade happy.

Nifty for 11 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.

The short term trend is down. For tomorrow, if the high of 4539 is not violated, then we can expect the trend to continue down. As of now, the Nifty seems to be consolidating rather than correcting. It could gather more downside momentum within a few days.

With some simple maths, we project a downside target of around 4300. These dips may be used to buy in. Of course, without saying, we must keep our stops to avoid disastrous loss of capital.

A sharp eye may also be kept on the coloured zones which are historical support levels. As of now, the market is just making nervous traders even more jittery. With gap up and down opens, it does not allow a normal trader to settle down comfortably.

The main trend is still up, and trades could be placed in the direction of the main trend.

Plan your trades and trade happy.

Nifty for 26 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.

A simple strategy of keeping a trailing stop has given us an additional few points on the Nifty. For a market like this, it is again suggested not to try and catch the tops or bottoms but to keep raising stops as per our comfort levels, and allow the market to exit us, rather than to exit prematurely.

The target range between 5000~5100 is still open. It also seems that the historic supply line may now give support.

Shorts? It is again very humbly suggested to avoid them at this stage.

Once more, I reiterate my slogan, plan your trade and trade happy. It is all in the mind.