Nifty Index updated on 18 August 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 maintained its status quo, without much movement either way. On the extreme short term focus, the trend is still up. If we step back slightly, the daily chart is showing two uncertain candles, a star and a doji. If we step back even further, the weekly chart is showing an extremely bullish candle.

The rising window of Wednesday is still open.

A classic consolidation pattern going on.

On Thursday, we saw that the FIIs have been net sellers in the derivatives segment, whereas, huge money was pumped into the cash. This could lead us to assume that the action is now going to shift from the index stocks to the mid-caps, and small-caps.

Nifty Index updated on 17 August 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 is indeed showing signs of being tired. But so far it has not displayed any exhaustion. As mentioned yesterday, the Nifty is still struggling with the roadblock of apprehensive bulls, who had bought at higher levels, and are desperate to exit at breakeven. As a picture is better for explanations, I have marked it clearly out on the chart. The gap (rising window) on the daily chart is still open. Which reinforces the (still) bullish mood. It still seems that the market does not want the bulls who have been left out, to enter at lower levels.

I still maintain my long outlook, though I have tightened my stops for my long positions, I still am in no mood to short, until I get a confirmation.

Nifty Index updated on 16 August 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.

In intervening holiday seems to have brought strong bullish emotions to the fore. The Index broke out up with a large gap. The breakout is more significant because it has moved out of an ascending triangle, which is considered to be an extremely bullish pattern. The high of today hit a roadblock due to profit booking. This profit booking is understandable, as a previous swing low on 16 May at 12:00 hrs registered a low of 3383. The previous demand zone normally exerts a supply resistance, as those who would have bought at higher levels, would be trying to exit at breakeven.

The turnovers on both BSE as well as the NSE were extremely good, again reflecting strong pent up demand. My personal trending indicators are still showing no weakness. True, the short term indicators are in overbought region, but that does not mean that the Index will collapse. It is natural to expect some mild correction.

The climb up of the Index over the last nine weeks has been laboured, no doubt, as it had to break through a lot of resistances. Now these very same resistances would turn as supports.

This brings as back to our mantra of buying on dips. And keep tight stops to lock in profits.

Nifty Index updated on 14 August 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.

Again, there isn’t much to add from Friday’s chart. I have just stepped back a little, and shown where the Nifty was receiving resistance. I have marked out the zone and also the specific points.

The bulls are doing their best to keep the Nifty from correcting downwards. They do not want the “fence sitters” to now enter at lower levels. The “fence sitters” have still not entered the market in a buying frenzy.

In due deference to the 400+ points rise from 24th, I would suggest that those among us who have indeed entered at lower levels, could tighten stops, to lock in profits. That would allow us to keep the market from taking out our profits back.

Unfortunately, from all the messages I am reading on various blogs, groups and websites, I perceive that traders are getting more and more engrossed in day trading, rather than stepping back and looking at the larger picture.

The Nifty has come out from a huge resistance zone between 3170 and 3200. Which could imply more confidence on the bullish bias.