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.Well, the bottle did break, finally.
Watching from a distance, it does seem that the RBI had something to do with it. The banks seem to have taken a major hit. And that seems to have triggered the negative sentiment.
My stop of 3980 has been triggered, and I would be out.
In most cases, such a sharp fall does have a knee jerk reaction upwards. The bottom fishers would be out, seeking to push the index up. The volumes on the Nifty future are almost close to the May and June bottoms.
Whenever we have seen such high volumes on the Nifty Future, we have always seen a convincing bottom.
How do we trade this? Simple … wait for 3872 to be violated on the upside, wait patiently for a downside move, and then go long, after a higher bottom has been established on the hourly chart.
Watching from a distance, it does seem that the RBI had something to do with it. The banks seem to have taken a major hit. And that seems to have triggered the negative sentiment.
My stop of 3980 has been triggered, and I would be out.
In most cases, such a sharp fall does have a knee jerk reaction upwards. The bottom fishers would be out, seeking to push the index up. The volumes on the Nifty future are almost close to the May and June bottoms.
Whenever we have seen such high volumes on the Nifty Future, we have always seen a convincing bottom.
How do we trade this? Simple … wait for 3872 to be violated on the upside, wait patiently for a downside move, and then go long, after a higher bottom has been established on the hourly chart.
The thumb rule levels are marked out on the chart.
2 comments:
I am following ur analysis for the past 4-5 months; I like it;
You have put the reason for the fall fully on the RBI; Kindly see the FII Net sell figure on 4th Dec; It is to the tune of 2800 Cr. probably the highest in a single day in recent times. FIIs tend to pull out in December. Maybe we are headed for a deeper correction
Hello Anonymous.
Thank you for your kind words.
Our job is not to try and predict the market, but to follow its trend.
And exposing ourself to the least risk.
Dusant
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