Update for 30 Jan 09…

Sh*cks – it did not last for the time frame I had in mind – Two bloody days and we cannot keep the gains in hand – where do we go from here? I have asked this question to myself so many times that I am sorry I really do not know – but I know for sure that down south may be the Million Dollar right answer. We do not have our destiny there in the bottom of the well – but till that painful decoupling takes place –this is the way to go. The earnings coming out of US are going just one way and that is down. The problem now – a – days is not the results – it is the guidance that is being given by the companies that is doing the major damage – you can imagine the scale of the problem that some companies declaring results in US are not giving the future guidance! It is this that is killing the markets more – there is no clarity of what lies in the future. So here we are – middle of nowhere really ;-).

The markets yesterday were not particularly bad – after two/three days of upswing requires a breather – especially in our markets where we look outside our own window for guidance. In any case the inflation is flat (increased marginally) did not help the case. As far as inflation is concerned the govt has taken the steps that I feel – will get it where the govt claims it will be – less than 3 by Mar. Fair enough.

The Global cues have gone negative – Europe started flat with FTSE green and then kept on dropping never to look positive again. FTSE was down 2.45%, Dax down 2.01% and CAC down 2.15%. US too started red and then there was no looking up. DOW was down 2.7%, Nasdaq 3.24% down and S&P down 3.31%. What would be interesting is the 8000 level on DOW – hold or break? It is the unemployment data and new home sales data that cracked the US today. Just wait and see if 8000 will hold or break. Last day of trading today for the week and the month. Will see – how much do we loose or gain this month.

The candles are somewhere in the middle of Bollinger bands. I had expected us to go a little higher before turning down but that was not to be. Now we will perhaps test the lower band of Bollinger and that is as of now flat at 2600 levels on Nifty. ADX was in a mood perhaps to show strength of the upmove as it was moving above 20 but is flat. The MACD could have moved to positive divergence but once again the divergence remained negative. MACD is bearish. RSI is down, Slow Stochastic is has turned back up before going to the oversold zone. It is TRIX that is looking up and I do take TRIX seriously – as generally it signals the way of the things to come. We will have to see the TRIX for some more time as it might just be flattening out before dropping more.

Let us see the pivot data…

Okay too the Pivot data now…

R3 2951 against 2945 yesterday
R2 2908
R1 2865
Pivot 2830 against 2823 yesterday
S1 2787
S2 2752
S3 2709 against 2701 yesterday
Projected High Range 2848 to 2887
Projected Low Range 2859 to 2820
Fib Projected High 2894
Fib Projected Low 2773

The pivots have not moved much from the yesterday’s levels – 8 points at the most on the lower side and 5 odd points on the upper side. Opening is going to be red but will S1/S2 hold out is my concern.

Best of luck for today. If you deal in NTPC trap it at 180/190 range with 8/10 rupees max investment and I feel the move will be good to give you good results. Best of luck.

How long will this last? Update for 29th Jan

Yes I mean it – if we say that it is a bear market then we have to at some stage take the upswing with a pinch of salt and decide where do we go from here? and perhaps when do we go – wherever it is. Firstly I am glad that out of the two scenarios listed out the markets have recovered for whatever reasons and we have not really broken the support to fall down in a spiral for far lower levels. What will affect the markets today? Firstly, fuel price slash – petrol down Rs 5/-, Diesel down Rs 2/- and LPG down by Rs 25/-. It will bring cheer as this directly affects the retail, inflation and morale.The second is the global cues that remain positive. Then there is the matter of expiry and rollover – that at the moment seems healthy. Fourthly there is the corporate results that are mixed and finally there is this problem of job layoffs. There is another stimulus that we actually missed out – the govt not reducing the interest rates of any kind – but why so? It was aptly put across by one of the commentator on the idiot box – a man went to the doctor and the doctor said there there is nothing wrong with you at the moment so no medicine is required. So inspite of the man (we) thinking that a rate cut (medicine) is required – the doctor (govt) does not think so – atleast till it sees the effect of the measures already taken. That was what had begun this rally. I will try now to give levels to this so that if we have to be cautious then we know where are the potential hurdles. The first major hurdle is just around the corner at 2936 and the second hurdle is at 3150. SO if you have to take the negative views with puts or sell futures – then these are the two levels that you have to watch out for – then we will again start with the debate of how much down we go.

 

If you see the chart of yesterday we see that inspite of opening positive there was no real direction for the markets till mid session. It was then that the 14 EMA (that I use) was clearly left below the 3 min line and it climbed. It hovered around the R1 levels to move up with momentum and break the R2 and end between the R2 and R3 levels. Both the pivot and the R3 are out of the chart you see. Today is the expiry – if we open gap up like we are likely too – except some selling pressure – especially if we open between R2 and R3 levels. If below R1 or pivot –then the climb may be through the entire session.

As far as the global cues are concerned – Europe ended well and at almost the highest levels of the day. FTSE up 2.4%. DAX up 4.52% and CAC up 4.11%. It was US that seemed very jubilant Dow up 2.46%, Nasdaq up 3.55% and S&P up 3.36%. This can be a month after a long time that – on monthly basis US closes positive (Can – as of now it is still negative by a small percentage point)

As far as the candles go - We have two good white candles and wee are confidently away from the lower edge of the Bollinger band this time over. On ADX the DI+ is above the DI- and that is good – but unfortunately the ADX does not lend too much strength to the upmove. MACD still is with negative divergence and like I have been saying that though it is still negative – this time over the divergence was really fairly low. RSI seems good today. Slow Stochastic is out of the oversold territory – but will signal reversal only after it reaches the overbought territory. TRIX is not looking down with the same vengeance it was some time back – so it too may give us a breather. Bottom line – if you were long – remain long.

Okay too the Pivot data now…

R3 2945 against 2869 yesterday
R2 2913
R1 2881
Pivot 2823 against 2744 yesterday
S1 2791
S2 2733
S3 2701 against 2619 on yesterday
Projected High Range 2852 to 2897
Projected Low Range 2813 to 2768
Fib Projected High 2879
Fib Projected Low 2740

See the Pivot move up by a good jump? Just for your info. On Nifty advances were 725, declines 440 and unchanged 62 with AD ratio 1.647727. FIIs were still selling in our markets worth 217.32 Cr but DIIs bought 601 Cr worth. So here you are – ready for the day? China and Taiwan markets are closed today.

Watch this space after the market opens for some advise on Options…

One day to expiry…. Update for 28th Jan

Good morning everybody. It was a very difficult decision for me yesterday to give a call that the markets will go green inspite of the technicals that were hovering negative – even if they did not really have too much of strength. Even for daily basis it is difficult to go against the trend as the fear of saying wrong weighs heavily on the mind. All the same I am glad that the markets did go up – only thing that i am not too happy is that I had expected Resistance 2 to be tested by nifty that never happened. The markets opened just short of the R1 and tested it once – then confidently moved above it – and remained above – closing at 2770. The Pivot – if you would have seen is below at 2701 and R2 above at 2805.

The global cues today are mixed to say the least. Nikkei had closed yesterday in green by 4.93% and the other markets were closed. The European markets opened flat – tried to go green and failed – they then fell deep in red only to rally in the last hour of trade to end absolutely flat. FTSE was down just 0.35% and DAX down 0.08% and CAC down just 0.03%. Believe me when I say that this was an achievement of sorts. US opened green and when I saw the indices I saw them dropping to red and my heart sank – just a day of rally and they are already sinking red? but earnings from US Steel corp and American express – that managed to post profits in present times boosted the morale enough to make them go green and then remain green thereafter. DOW ended 0.72%, Nasdaq up 1.04% and S&P up 1.09%. It is Nikkei here in Asia opened flat – went green and then red that is a small cause for worry. but it too may recover by the time we open. Strait Times i up 2.35%.

On our candles – it was a good white candle. The candles have moved away from the Bollinger Bands and hopefully the run should be upto the middle of the bands and in the best case to the upper edge of the bands. So if you are interested in initiating shorts – then the first levels should be around 2850-2900 and second set around 3100.  As I see it we have has three peaks in 3100-3200 region and if we do not cross this resistance or whatever then the downside may be larger than what we have seen in recent times. Other than this no lower term EMA has yet crossed the higher term EMA so too much trust on this uptrend may be counter productive. ADX is still bad – DI- has looked down but the DI+ has not correspondingly moved up really.MACD still remains negative but divergence has reduced further. RSi is still negative but looks up.Slow Stochastic red line has crossed the blue line so mildly positive we can say. TRIX is still looking down and I really do not know what will cheer it up.

There were 638 stocks advancing on nifty and 544 declining and the ratio is 1.172794. The Pivot data is as under:

R3 2869 against 2869 yesterday
R2 2836
R1 2803
Pivot 2744 against 2701 yesterday
S1 2711
S2 2652
S3 2619 against 2533 on yesterday
Projected High Range 2774 to 2820
Projected Low Range 2734 to 2688
Fib Projected High 2802
Fib Projected Low 2659

Now all there is left is the issue of rate cuts – I will put across my views today – later or tomorrow. Best of luck for today.

Light at the end of the tunnel… Update for 27th Jan 09

I am sure that so many people around the country like me are eagerly looking for some signs of revival after one drop to another in the markets. Well before I rant about the markets .. I really had a good big break off the markets for three good days. Saw the ‘SlumDog Millionaire”, had my Unit officer come over for the week end and went to Trimbakeshwar. Did not spend a moment on the TV or the computer and it did turn out to be a big break and a wonderful experience. The Slumdog turned out to be a good movie that kept me to the edge of my seats and I – Personally really liked it. A glimpse of India that we want to wish away without contributing in any right way. Ahhh! food for thought – what did you do for the country today? Threw rubbish on the road? Went to a Old age home? Or were just too busy thinking money!

Sorry for the ranting of a Fauji – Let’s start! There is definitely a disgustion of the present tidings in the markets. Bad gets worse every day, one black candle leads to another and so it goes on and on. I will try to put forward what I feel has happened over the past few days. Firstly, the markets have dropped - (as if there was someone who did not know that).

It made black candles for four continuous days. The majority of the sell off has come from the FIIs selling and the volumes have been low. The volumes on Friday on Nifty were 103% of 50 day average – but before that we were nowhere near the averages. So by my mind the sell off or the drop that we have seen for last few days has perhaps more to do because of lack of buying than the selling pressure alone. On an average day when we have FIIs sell off 400 Cr worth and DIIs buy 200 Cr worth the markets stand still – making a doji or the like. So what I mean to say that this selling or buying is really just few disinterested people perhaps trading and making bets on an otherwise dead market. If in these volumes it is easy to drop the markets a few hundred points – then it is as easy to make the markets climb a few hundred points. What exactly should the markets be waiting for now? There is hardly any event of worthwhile nature that one should look forward too – politically or something like the nation going off to war. If my reading is correct then the results are beating expectations. Or let me put it across this way that in most of the cases the companies are beating or atleast meeting expectations. So if we say that the markets discount the future then this is not too bad a scenario. Now what does the market feel will happen in the coming future. Most commentators say that the worst seems to be over – for India atleast and that we will eventually swing up – a bit slower than expected but – recover definitely as the inflation will ease further and the demand will pick up and all the efforts of the world govt would now slowly and definitely show positive results. If you look at the chart I posted above – I had posted this chart and a few days back and explained that one scenario is that we break the support the markets are getting at the moment and go up – or go down to visit the long term support/trend line at sub 2000 levels on nifty. I am now sure – seeing the market behaviour for last few days that the will to drop the markets to sub 2000 levels is missing at the moment – tomorrow if we have some other inputs then we will see them in new light but as of now we should recover to higher levels starting tomorrow perhaps. Another reasoning for this theory of mine is that we just do not have the kind of momentum taking the markets down like we has – say in oct or nov last year.

The indications on the charts continue to be bad and will take some time before there is an improvement. If you notice carefully you will observe that the candles are no longer trailing the lower Bollinger bands really – so that is a small mercy to start with. 5 EMA is below 20 EMA and that is below 50 EMA. So frankly this tells us to remain on short side only – but then they are trailing indicators. Once again observe carefully as the DI- on ADX has looked down the ADX line has raised its head above the 20 marker and may eventually support a rally for whatever it is worth. MACD is bad but once again observe that the negative divergence is really not the kind we saw earlier. It is negative nonetheless. RSI is bad and negative – goes without saying really. Slow Stochastic red line is oversold and blue is likely to join it there within a day or so if the selloff is there. TRIX ofcourse is negative.

The world markets were indecisive on Monday really as a lot of exchanges in Asia were closed – and Nikkei fell. Monday however has turned out to be good for FTSE, DAX and CAC that ended 3.86%, 3.54% and 3.73% up  respectively. The Pfizer-Wyeth acquisition and the surprise jump in sales of existing homes is the reason being quoted as the US too is trading in green (a rare sight indeed in these days). It is little past the mid session there in US but all the indices are holding on to 1% and above gains. I hope that they remain and close green.

It is late night so will update the market behaviour when I get time tomorrow – but have a look at the pivot data for tomorrow.

For tomorrow let us see the Pivot levels…

R3 2869 against 2807 on Friday
R2 2805
R1 2741
Pivot 2701 against 2712 on Friday
S1 2637
S2 2597
S3 2533 against 2618 on Friday
Projected High Range 2721 to 2773
Projected Low Range 2756 to 2704
Fib Projected High 2793
Fib Projected Low 2632

Purely looking at the Pivots – looking forward to touching R2

Smile

Click

;-)

Take some time off…

Confusion galore… Update for 23rd Jan 09

At this rate the month is going to go by with only confusion and confusing thoughts. Let us first see what we have in hand then we will try and find some solution to our problems around. Firstly, our reliance results are out. What played in my mind was that the results will be declared during the off trading hours and will never know what side the markets will swing. The results are not good but all the same they have beaten the market expectations. Couple this with Bharti that has managed to beat the expectations we have some hope for the coming days. So far so good… but in US the results declared by Microsoft has put everyone in renewed worry of recession. They now announce that 5000 jobs will be cut and the US markets are fast sinking to these results. Which lower low will they finally settle to – GOD only knows.

The Asia today traded in a fairly narrow zone around the flat line – but just before the ending there was some buying support and ended with some gains. Nikkei was up 1.9%, Hang Seng up just 0.59% and Strait Times up 0.25%. Europe traded most of the day in green but before closing could not hold on to the gains and slipped red. FTSE down 0.19%, Dax down 0.98% and CAC down 1.24%. Less we talk about US the better – Obama effect is nowhere to be seen. Nasdaq has slipped down 4.09%, S&P down 3.28% and DOW down 3.14%. I only hope that they do not close at these levels. GOD bless America. Yahoo is saying that some John Thain has left Bank of America – I really do not know him but all the same yahoo is splashing this as their headlines so I thought would be important enough.

On the charts it is a copy book – perfect Doji. Had it been there after a trend – whether up or down it would have been a strong signal of a reversal – but in these times of confusion I think it too signifies just that – CONFUSION. No one really knows which side the markets will finally go. The markets are going near the bottom of the Bollinger bands and the bands too are expanding with the narrowest being on 7th Jan. 5 EMA is below the 20 EMA and 20 EMA is below 50 EMA. There is no future in seeing these lines. The volumes were a tad higher – but that is it. ADX is bearish, MACD divergence has increased a bit – Bad. RSI still bad and TRIX is looking down and Slow Stochastic is nowhere – still to go oversold. So the path is clear for a drop – by another 200 odd points? but then in this business – there is no clear cut directions.

Let us see how today panned out to be! 

 

The Pivot for the day was at 2727 and that was voilated on the downside early in the trade and thereafter the markets took this as the resistance and these levels were never crossed really. On the lower side the Support 1 was at 2668 and the markets never went down enough to see those levels.

For tomorrow let us see the Pivot levels…

R3 2807 against 2884 yesterday
R2 2775
R1 2744
Pivot 2712 against 2727 yesterday
S1 2681
S2 2649
S3 2618 against 2571 yesterday
Projected High Range 2728 to 2760
Projected Low Range 2728 to 2696
Fib Projected High 2761
Fib Projected Low 2663

Best of luck for tomorrow – last day of the week.

Believe me when I say it was not bad… Update for 22 Jan 09

I will say that believe me that it was not as bad it probably could have been. I say that with respect to our closing above the 2700 mark – even tough it may have been on the account of the adjustment on closing. The volumes too were not too impressive. If we have another black candle then prepare for a down swing otherwise count yourself in the same narrow band that we have been seeing for so long now. The candles had reached the lower edge of the Bollinger bands – went to – just short of the middle of the bands and then turned down to the lower edge again. Another problem that I see here is Bollinger band that has broadened a bit and turned the snout downwards. That does not seem good. More on the candles and technicals a little bit later.

The world markets are just figures ticking here and there – with no direction really. Nikkei closed down 2.04%, Hang Seng down 2.9% and Strait Times down 1.09%. Europe was a bit better with mixed closing. FTSE closed in red by 0.77%, DAX up 0.5% and CAC down by 0.67%. The US is thankfully in green as of now – DOW up 0.99%, Nasdaq up 1.35% and S&P up 1.2%. It has become such a hogwash really – see the US direction and say where we are to open. If you want a bit more accurate prediction then see SGX Nifty trading, then to see where we are going for closing – look at the Europe closing. So do expect a positive opening especially if the US remains green.

The ADX shows bearish run (as if we could not see it) but the thing that I am putting across is the the strength is not there to push this trend any further – so this drop should finish. RSI is bad, MACD negative divergence is almost where it was – once again not showing any real increase of divergence. TRIX looks down and that too seems evident. Slow Stochastic seems to be turning back facing down and the red line is below the blue line.

So let us see how the day went today. The markets opened gap down as was expected but took solid support at S1 levels. I had frankly expected and chatted that we will now go up to the pivot levels – unfortunately the corporate results perhaps gave a jolt followed by the Educom rumour that gave the opportunity to the bears to break the S1 levels and move on to the S2 levels. Infact such was the momentum that at a stage before the closing it seemed that the markets will run down and see the S3 levels also but fortunately that was not the case and the markets bounced back somewhat – got adjusted for the closing and closed a wee bit above the 2700 levels – psychologically very important support levels. Take a look at the chart. The pivot is above at the 2798 levels and the Support 3 is at the 2671 levels. So you see – could have been worse.

The pivot data for tomorrow is as under: -

R3 2884 against 2926 yesterday
R2 2824
R1 2765
Pivot 2727 against 2798 yesterday
S1 2668
S2 2630
S3 2571 against 2671 yesterday
Projected High Range 2746 to 2795
Projected Low Range 2779 to 2730
Fib Projected High 2813
Fib Projected Low 2663

Hope we will recover well tomorrow – and watch out for the reliance results – may be that make or break we have been waiting for…

Sick of this non directional trading… Update for 21 Jan 09

So the Obama magic does not seem to be working – the markets are weak. What happened today was not really expected – but then I suppose that we are used to these indecisive moves. In these times the option writers seem to be having a ball of a time. But wait – you just try to do the same and the markets will trend so strongly in some direction that it will mow down your positions like the tanks are doing in Gaza. Actually if the markets are not paying regards to Obama – what the hell were we really expecting by his taking office? Miracles ? forget it… I too fell for it… the Obama swearing in factor @@#$#. I will take time to set it aside and go ahead with the times. We had a fairly good rally going on when Raju spoiled the day – and there is nothing that is now convincing the bull to wake up and bears to let go of the half dead bulls.

The markets everywhere are a shade of red. Asia closed with Nikkei down 2.31%, Hang Seng closed down 2.85% and Strait Times down 1.35%. Europe also closed down – FTSE down 0.42%, Dax down 1.77% and CAC down 2.15%. Europe went down even after showing a good chance of remaining green or flat. The US tilted the Europe closing in favour of red. It is mid session in US and they too are red. Dow down 1.66%, Nasdaq down 2.88% and S&P down 2.42%. They were off their lows for some time but are again trailing down around the days lows. Hope like hell that they recover.

It is confusing to say the least – the markets have actually fallen on fairly low volumes. The candle has not really pierced the day before’s white candle as as I see it – it does not threaten the swing up for whatever it is or it was worth. The red candle today was not strong enough to spell the change in trend. 5 EMA is lower than 20 EMA is lower than 50 EMA. there has to be some crossover of higher EMA by lower period EMA to say that we have a chance of going up. Noticed that the entire trading was in a narrow band of 50 on Nifty? crazily narrow to say the least. ADX again has the DI – line above the DI + but the trend is weak so that is where I am hoping for the recovery as the bear trend too is not being supported by it. The MACD is still with negative divergence but has reduced somewhat. RSI is bad and bearish – also falling down. Slow Stochastic red line is above the blue line and is fast heading towards overbought zone. If with the markets virtually standing still the MACD is going overbought then GOD only knows what will happen when the selling starts. TRIX still looks down only.

Let us now see how the day panned out in the markets today. The markets dropped below the Support 3 but could not sustain at those levels. Then it spent the rest of the day in a very narrow 20-25 point range finally deciding to test the support 2. Once again it could not sustain at levels above the Support 2 but gracefully or let us say thankfully ended at those levels itself.

The pivot data for tomorrow is as under: -

R3 2926 against 2917 yesterday
R2 2882
R1 2839
Pivot 2798 against 2844 yesterday
S1 2755
S2 2714
S3 2671 against 2771 yesterday
Projected High Range 2819 to 2861
Projected Low Range 2823 to 2781
Fib Projected High 2864
Fib Projected Low 2735

Okay the figures I take to calculate the pivot data are from the NSE website only but take for example today the high levels give are 2842. These were the levels where the Nifty opened and hardly stayed there for a few seconds before dropping like a hot brick – so I really do not know how to compensate for such data. All the same this is all I have and please do not ask me the direction – don’t know – and I will be surprised if anyone knows. Best of luck…

I want to break free…. Updated for 20 Jan 09

I want to break free from the shackles of the narrow trading range we are seeing – but frankly the way the things are looking – I really do not see an alternative. The markets are now trading in an extremely narrow range that I am sure is not sustainable for long periods of time. There are now various news and facts that are likely to pull the markets in different directions. Obama factor has somehow become a big one as people are expecting a miracle solution from him. It was so big that during the day – idiot box was shouting that every one is waiting for some dramatic announcement from Obama. I am at a loss what that can be – but since everyone is saying so – I too am waiting for some mumbo jumbo that can take us (US) out from these difficult times. Whatever his magic therapy will be will be ripped and studied in detail. If the mumbo jumbo has anything in it that is not practical – the markets will react wildly and negatively. On the other hand if the announcement is positive then the markets will take measured steps up and see how they will  fare. This is so because any measure that is taken will take some time before it takes the train of the US economy chugging along. Meanwhile the latest is that Britain has announced the second rescue plan to thaw the frozen credit assets. The markets do not seem to have reacted overly positive to this news – but are in green all the same. The second thing that is likely to pull the markets are the results that will be announced everyday now… that includes the results from the heavy weights like Reliance…  These are the results that can swing the markets in any direction taking a few other markets along with them. Now again as far as the results are concerned there are two parts in them that have to be looked forward too – First… the earnings for the quarter and the Second… guidance for the next coming quarter. Here I feel the results part is going to be not so good because this was the quarter that came under immense pressure due to inflation, sagging demand, negative outlook in every nook and corner. But on the other hand I see it as discounted to a large extent. Now comes the second part the guidance… this should be better as there is an improvement – a slew of measures taken are going to show, inflation is dropping, fuel prices are under check. The next is the general elections – but I will disregard them for the time being.

To say that the markets are remaining range bound is an understatement actually. They are just not moving at all. But the narrowing range will end this period of indecisiveness with a force. Well I too am waiting along with so many others. Some how I am getting convinced that the breakout might be on the positive side but wait and watch is all that we can really do in  this case.

I really do not have anything new to say in the charts for today. the candle was small but white – at the same time sensex was red so take this will a bucket of salt. We have moved away from the bottom of the Bollinger band but nothing to write home about. Volumes were not good really. In ADX - DI+ has moved above the DI – so that is about it. Now we should wait for the trend to be given a support by the DX. MACD has the same negative divergence that it had yesterday. RSI is moving up, Slow Stochastic is too moving up. TRIX is still looking down. So that is all to the indicators as of now.

The daily chart is not update on the iCharts so will post it later in the meanwhile look at the pivot data for tomorrow…

R3 2917 against 2946 yesterday
R2 2893
R1 2869
Pivot 2844 against 2795 yesterday
S1 2820
S2 2795
S3 2771 against 2549 yesterday
Projected High Range 2857 to 2881
Projected Low Range 2854 to 2830
Fib Projected High 2881
Fib Projected Low 2805

I will surely update the daily trend that we had today whenever I get the iCharts data…

Okay here we go with the days performance…

the markets opened above the pivot – infact a lot above but could not cross above the R1 and the chart is like this…

Sorry for the late upadte…

I actually had a bad case of indigestion after I saw “Chandni Chowk to China” – so much so that it can be directly blamed for the indigestion >> leading to a bad taste in my mouth >> hence the update at mid night on 18th. This is not the forum to discuss movies but for GOD’s own sake try not to waste a brokerage worth on buying tickets to this movie.

We are at curious crossroads – and some how I have got into a habit of discovering one everyday – we have two stalwarts who supposedly make money on the markets – the FIIs and DIIs. If my reasoning is correct then both should be making money – because I (read the retail) is not. If that be so then to remain on the winning side either both should be buying or both should be selling – well on most of the occasions one buys and the other sells. Take for example on Friday the FIIs sold 585.41 Cr worth and DIIs bought 400.73 Cr worth in the markets. Why are both of them on opposite sides? This is my first observation – second observation is that the selling is more (585 Cr) than buying (400 Cr). Then why did the markets go up and ended in positive? was it that the pivotal heavy weights could not be beaten down by the FIIs? Is it that these pivotal are now in short supply with the FIIs and they do not want to short without having some sort of holding? Now if that is true then are we going up inspite of the FIIs selling because the HNIs and the retail too are buying in the markets? Does that mean that We (DIIs, HNIs, and retails) are bullish at these levels and they are bearish (FIIs)? If we are at such levels then we should slowly change our mindsets to bullish inspite of being trapped in this narrow range of trading because the FIIs do not have the kind of holding to kill us further and we are convinced that we are at the lowest levels possible?

I cannot take this to the kind of conclusion I want because I do not have time and there are too many questions that I want answered before I say for sure what is in store for us. The purpose of this is to perhaps throw these questions – set some thinking by everyone of us in motion so that we can refine the theory. So before I go to the next stage of this blog I would request everyone to contribute to this in whatever way you can.

There was a fair run up in the in the markets – starting with Asia – Nikkei ended 2.58% up, Hang Seng up 0.09% and Strait Times 1.55% up. Europe too was  not bad but they did not end the day at the highest levels. All the same it was not a bad day. FTSE was up 0.63%, DAX up 0.68% and CAC up 0.7%. US opened positive – dived nose down in red during the mid session and then again recovered by the closing in green. DOW closed up 0.84%, Nasdaq up 1.16% and S&P up 0.76%. The bad news is now getting soaked up and does not seem to trouble as much as it used to some time back.

What do the charts say? not too much I am afraid. Look carefully – we had a white candle, a black next day and white candle the next day.what indecisiveness in the markets. The body of all these three candles are of approximately the same width. The confusion persists but we still hug the lower of extremes of the Bollinger bands and 20 EMA is lower than 50, 5 EMA less than 20 so what is says that the run is bearish. Look at ADX notice that when the markets were falling down the trend was strong, then the markets tried to raise but the ADX showed weak trend. – after a while we again started recovering and this time the ADX showed strength. Now when the markets have dropped – it does not show strength at all. So I take it that when the markets will recover there will be strength in the markets. Well we may be in some good swing up in that case. MACD still shows negative divergence – RSI is showing strength – rather let me put it across – is positive. Slow stochastic is recovering as was expected as it was in oversold territory. the red line too is above the blue line and that is good. The TRIX however looks band and only bad as it is looking down. The volumes were a bit on the lesser side – and that will remain to be my concern.

R3 2946 against 2963 on Friday

R2 2906
R1 2867
Pivot 2795 against 2756 on Friday
S1 2756
S2 2684
S3 2645 against 2549 on Friday
Projected High Range 2831 to 2887
Projected Low Range 2783 to 2727
Fib Projected High 2865
Fib Projected Low 2693.

I am sorry it is very late and I have not been able to work out the second chart I post with resistances and supports – however I am posting it without the levels.

and sorry no time to proof read it either – will see it in the morning and yes I feel the markets will remain positive till hitting the upper portion of the Bollinger bands that is around 3200 levels… best of luck

Another interesting one in mail....

Guys... the last days technicals are there ... just scroll down... last to last post

from a mail i got.... The technicals for today are in the post before this..

Raju Raju sat on the wall
Raju Raju had a great fall
Balance sheet died
Shareholders cried
Raju Raju made a fraud

Raju Raju
Yes baba
Cheating us
No baba
Telling Lies
No baba
Open the balance sheet
HA HA HA

Just another ordinary non trading day…

Cheers: US ended in green and Asia has started in green. Nikkei and Strait TImes both in green.

So we did have a bad bad day – I really hoped for a few days worth of rally but in the hearts of heart I knew that it was an aberration and it would not continue like this. Feeling sad all the same. Like I said a day before – my leave has finished and I really do not know how regular I will be able to updating the posts. All the same till the time I can. I would like to share what I have read about using option trading – initiated me into learning options by Uma ofcourse – a relatively safe way to loose money ;-) but definitely with a potential to make a lot of money. Some other time definitely. Well for today the markets looked bad bad and nothing but very bad. How to survive such markets is more of an art than science. We – as markets performed – reflecting the sentiment all across the world. Nikkei ended down 4.92%, Hang Seng down 3.37% and Strait Times down 3.44%. Europe is also red but they have escaped the sell off that was seen in US and in Asia. It is around mid session in Europe and – FTSE is down 0.78%, Dax down 0.94% and Cac down 0.81%. I will try to update when the Europe ends trading and the US starts the day tomorrow.

The Charts do not look encouraging still with the candles trailing the lower portion of the Bollinger bands. The black candle has negated the white candle yesterday. ADX is bad, 5 EMA is below the 20 EMA, MACD divergence is negative and RSI is really bad. Slow Stochastic is one good indicator that is totally oversold and will give some relief. The relative volumes too were not too great. TRIX is bad as bad it can be.

There is nothing else to day really. The trade today too was in a fairly narrow band and it has become a sort of a habit only trading within 50-60 points really. The support 2 was where the markets opened and that held for the day. Markets tried to go up to test the Support 1 and then like a textbook returned back – all the way to Support 2. (One thing before you see the chart for the day and wonder – The chart is 5 min one so the high and the low you see are little off. For example the high was 2832 that was also the opening and is not represented very well in the chart) That is what the markets are doing really these days – too narrow a band for the traders also to take chances. The decay in options will kick in tomorrow and then we just have the rest of the month to wait and watch. The non risk operators will sit aside and relax whereas those who will nibble at the markets will loose some and gain some. Till the time there is some direction – the times will remain as bad. Remember what I have been saying the markets will break out and break out with vengeance i the longer we stay at these levels the more violent is the breakout likely to be.

R3 2963 against 2958 yesterday

R2 2887
R1 2811
Pivot 2756 against 2812 yesterday
S1 2680
S2 2625
S3 2549 against 2666 yesterday
Projected High Range 2784 to 2849
Projected Low Range 2814 to 2749
Fib Projected High 2867
Fib Projected Low 2665.

 

Best of luck for the trade and hey remember there is a week end around the corner so do not expect the closing to be as per what you think should be…

Hey Don’t get too excited by the run up today….

It was all good – but now past us. Technically it is difficult to support this run up today. The Nifty and Reliance had run up today on news partially and on lower than 50 day average volumes. Little less – but less nevertheless. Reliance advanced 9.48% on 89% of 50 Average volumes, Nifty advanced 3.29% on 85% volumes, L&T 1.34% on 59% volumes, Tata Steel 5.23% on 58% volumes… the list goes on. Now go on to the other side – Gail lost 0.92% on 103% volumes, HDFC bank down 1.14% on 143%. The list is fairly long and the run up is not really full-fledged. Time will tell the rest.

Asia was good – Nikkei ended 0.29% in green, Hang Seng 0.27% in green and Strait Times 0.16% in green. Mind you they had dived nearer or lower than their opening levels. Europe opened at levels that remained the best for the day. The closing was – Red – FTSE down 4.97%, Dax down 4.63% and CAC down 4.56%. US just has carried the red rally further with the markets in mid session down – Dow down 3.05%, Nasdaq down 3.17% and S&P down 3.42% – there is a long way to go. They might come off these lows but the possibility remains bleak. Our ADRs except for one odd are hammered down like hell.

Tomorrow also we have a lot of news coming in including the inflation data that has now-a-days lost much of its shine as markets do not look forward to it. As far as the candles are concerned the candle today was a large and white one. It came off the lower end of the Bollinger band and 5 EMA does not still look like crossing the 20 EMA (the chart does not show the 5 EMA). The ADX does not give any credence to this up move – but it does also say that perhaps the down trend is loosing steam – negative nonetheless. MACD negative divergence remains/ RSI looks up – hopefully we can call it positive, but one of my favourites – the TRIX is looking down with vengeance. Slow Stochastics oversold and that is the second indicator that holds out hope for us.

 

Seen the markets playing out – opened at R1 levels and then kept going up almost to the R2 levels – then testing the bottom at the R1 Levels finally breaching the R2 – unable to sustain and coming back to the R2 levels. Basically the game was about the two resistance levels. The red line is the 14 minutes EMA and leave aside few whip lashes – you could have 30 – 40 run each sides.

The pivot data for tomorrow…

R3 2958 against 2884 yesterday
R2 2917
R1 2876
Pivot 2812 against 2755 yesterday
S1 2771
S2 2707
S3 2666 against 2626 yesterday
Projected High Range 2844 to 2896
Projected Low Range 2809 to 2757
Fib Projected High 2881
Fib Projected Low 2719.

Hey best of luck to tomorrow. I really I am just a pessimist around the corner and am proved wrong by the markets.

 

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Food for thought… are we heading towards… this?

      

Just for a laugh and it will not be this month I can assure you all…

(copied from a mail I got)

Some other strategy…?

Actually I got a kind of bored so decided to do a different approach to the problem of our markets. I will try to pin the markets on the charts so will take some help with them before I go on to my otherwise daily routine of day to day charts. The chart on to the left is an otherwise a 3year daily chart that I have clipped down to our area of interest only – let us say Dec 07/Jan08 the root of the trouble – the time we started really falling.

There are two possible scenarios that come out of these – Firstly the line that is sloping down with this trend and started from Jan onwards is the trend line that has proved itself as it has touched the bottom for three times. A lot of non believers also agree that a real trend can only be determined after the prices test it over a period of time. If that be true then we are in for a big big trouble. The support will then come only after we touch sub 2000 levels on nifty – and that is in present times – if that is the trend and we test it let us say after another few months then it will hover nearer to the 1500 levels – scary. How does this theory get the support? well the study in the middle is MACD and every time it has made a peak and the red line crossed below we have forgone the upswing and went on to lower levels. In times like the present ones the MACD has definitely touched 200 levels and that is almost a 900 odd point drop. If – let me say if we have to take support with this trend line then DOOM is the word for it.

Well if this is scenario one then there is another possibility that you see by the flag being made by the second and the third trend line. As per this we take support at around 2719 levels and then start going up eventually breaking out in some direction. Let me say 60:40 – 60 to break out lower and 40 to break out higher. Like the first possibility is supported by the MACD – the second possibility is supported by the RSI. in another onslaught of 50-100 points over next few days we touch the 2719 support – RSI reaches 20 odd levels and we recover. It would be extremely interesting to see what gets played out finally.

Asia did not do well with Nikkei closing 4.79% down, Hang Seng down 2.17% and Strait Times down 0.81%. Europe too closed red but not at the lowest of their day. FTSE closed 0.61% red, DAX down 1.75% and CAC down 1.49%. US opened flat with negative bias but remains indecisive so far with DOW in red by 0.01%, Nasdaq green 0.84% and S&P green 0.34%. A long way before it closes and can swing anywhere. The violations of the Bollinger band by nifty goes forward as expected yesterday. 5 EMA is now hopelessly below the 20 EMA – bearish, ADX is bearish, MACD is bearish with increasing divergence. RSI bearish, Slow Stochastics bearish but entered the oversold territory and TRIX bearish and looking down. Volumes were 91% of the last 50 day average.

See how beautifully the day got played between the pivot and the Support 1. Traders can make use of these levels and make their daily killings. The Pivot data for tomorrow is as under: -

R3 2884 against 2990 on Friday
R2 2837
R1 2790
Pivot 2755 against 2796 on Friday
S1 2708
S2 2673
S3 2626 against 2603 on Friday
Projected High Range 2773 to 2814
Projected Low Range 2790 to 2749
Fib Projected High 2824
Fib Projected Low 2697.

Best of luck for tomorrow.

Technorati Tags: NSE india,Stocks,Candlesticks.

Loosing hope? Don’t -- this is going just as predicted…

0823hrs: Hurray - we have ticks of green in Asia. HangSeng and Strait Times are green.

The times to improve are surely coming around the corner. The light at the end of the tunnel can be seen if you look carefully enough. Hey by no way I mean that the uptrend is about to start – there are no indicators pointing towards that other than my heart. The day was not nice today, and incidentally we were also the worst performers at the market. Whereas Nikkei closed just 0.45% down, Hang Seng 2.83% in red and straits times 1.65% in red, we ended up 3.15% down on BSE and 3.48% down on nifty. And mind you, these are not the worst levels for the day. The Satyam story overshadowed everything else that came or is to come. And this announcing that global firms are scared by the revelations of almost USD1 billion accounting fraud of a company that was also listed on the New York Stock Exchange. The breadth of the market was negative today. All the sectoral indices also closed in red with BSE metal index dropping by 5%. Out of the 2520 scripts traded on BSE, over 1610 had declined. Tata steel, reliance infrastructure, lost almost 7% each. Reliance, Ranbaxy, DLF, BHEL, SBI and ICICI bank -- all repeated the same story with reliance losing over 4%. The nifty January futures have moved to a discount of 23 points. In this onslaught, the good news gets hidden in the blanket of negativity that floats around. The IIP Data that came out was a welcome relief. The drop in inflation also got swallowed by the bad news last week. The oil has again started steadily declining. I think it is time that we leave the Satyam story behind and move on with our lives.

On the global front, as I write this article, the Europe is also ending red. FTSE is down by 0.76%, DAX is down by 1.46%, and CAC is down by 1.45%. US two has not started the day on too good wicket. As of now Dow is down by .85%, NASDAQ down by 1.17% and S&P 500 down by 1.4%. And all this is happening, ahead of the earnings report expected this week.

On the candles the story could not have been any worse. Today is the third black candle that we have had. The candles can taken to be three black crows and it indicates we have further  downside from this point onwards. That is substantiated by the third candle that is violating the lower Bollinger band. The Bollinger bands have widened and may give this trend the strength it needs. The five EMA is definitely and comfortably below the 20 EMA. The ADX however, is not lending support to this downtrend and that is good, though, as such the ADX is giving a bearish outlook. The MACD is bearish with the negative divergences increasing. RSI is not good and looking bearish. Slow Stochastic is bearish the only relief being that the red line has gone to the oversold territory. However before the recovery comes the blue line too shall join in the red line in the oversold territory. The TRIX has started looking down and bearish. Provisionally, the FII's sold 563.57 crore and the DII bought 217.83 crore worth in our markets.

See the markets behaviour today? Started out definitely below the  pivot lineand went on to drop piercing through support 1, the support thereafter proved resistance for the markets to recover.The markets played the rest of the day between the support 1 and support 2. The increasing volatility will lead to play out in such large ranges.

Pivot data for tomorrow is as under: -

R3 2990 against 3048 on Friday
R2 2917
R1 2845
Pivot 2796 against 2870 on Friday
S1 2724
S2 2675
S3 2603 against 2693 on Friday
Projected High Range 2821 to 2881
Projected Low Range 2856 to 2796
Fib Projected High 2901
Fib Projected Low 2715.

 WoW that is a lot of data for everyone to chew. The technical s indicate continuation of the fall – but I say that we may recover.

One step at a time….

One small step at a time the market recovery was being built up and suddenly it goes up in smoke – poof… and why? One corporate house of the country that did the vanishing trick with the name they built – Satyam. So much has been said about them that I will try not to mention any more. Our markets were not doing bad – we were building the house brick by brick – as put across by IndiaBulls in their monthly report. The stimulus package here and the actions by the US govt there alongwith the rest of the world was being slowly digested by the world and there was a recovery here – volatility – and recovery there – basically we were climbing up one small step at  a time. And then came the Indian home brewed story of mega corruption and we all fall down. We have basically have had two days of the fall – two big black candles to speak of. Frankly there are now indications that we have had enough of fall already. The second candle made on the Nifty and so many other important stocks is of a hammer. Technically many may brush aside such a formation as it came after a doji and a black candle – such a signal to be meaningful should have come after a trend – downtrend to be precise – but I could not help and observe – the markets did try to recover on friday. Was that my imagination or there was something else to it. Perhaps the traders did not want to carry their positions of profit over the weekend – or perhaps there is a feeling that the news driving the markets did not deserve the kind of attention it really got – they are debatable and I am not going into a debate at all. But I do feel that the shorters’ can get trapped if they are not careful as there is a chance that the markets will bounce back for whatever it is worth.

We are expecting our GDP to settle around 7% – give or take some. the IIP data is bad and exports are likely to remain bad for some months to come. The next sectors to hit might be the service sector – because of the reduced consumer spending. But all is not bad – the inflation is on its way to touch 3-4% by march and that by itself is no small feat. The crude that had a spike recently was more due to the middle east tensions and Russia cutting off gas in Europe. It will get resolved and the prices should stabilise. The banks will finally come on to the rate cuts – that they have been resisting so far and have offered half hearted cuts only. There should be another fuel price cut and that should make the things easier soon. The soft monetary policy pursued by RBI will continue and we may have some more stimulus package even though denied at the moment by the govt. The FII money inflow should remain positive in the coming months. All in all – I strongly believe that the last two black candles were an aberration and the up swing should continue – albeit at a more careful pace perhaps.

If that be so I still do not feel that everyone will do well…

Real Estate – no go – the worst is yet to come. The valuations are not related to the ground realities. The markets have not crashed but I am sure that big names should be in trouble in times to come.

IT – should survive – but will be under pressure. The rupee as I see it will definitely strengthen, and the pricing will be more competitive… growth will be hit. Infosys results are around the corner and they are likely to beat expectations as the rupee has been weak – and then the ball will roll down.

Banking – Will do better than expected. Indian banking – especially the govt owned banks are the place to be.

Auto – less said the better at the moment.

Gas – don’t miss the bus – if you have believe me this is the place to be. blindly trust me and park a percentage of your money here. There may not be any great positive news in near future – but neither will be any negative news and the demand is going to grow exponentially.

FMCG is also likely to do good in near future.

I have left out some sectors – will talk about them some other time. Now what you read on top was what I felt – but the candles tell a different story altogether and I have been pondering hard. The story they tell is bad and bad – Firstly the Bollinger bands have expanded, 5 EMA has almost dropped below the 20 EMA, the candles have come to the lower band from trailing the upper band in a jiffy. The volumes accompanying were quite high. MACD has had a bearish crossover and says – sell. RSI is bearish, Slow Stochastic is bearish. Reading the ADX is an art so do not blame me if I get it wrong – I feel the down trend is loosing steam – Jaggu says that it is bearish – take your pick. TRIN as said by Jaggu is bearish – you can and should visit his blog to get an idea. TRIX has started looking down again. We have some lower targets now.

 

Time to see the magic of the Pivots – the markets did not see the pivot levels on Friday. They went down to the Fib lower expected band and definitely recovered but nowhere where we would have wanted it to be.Any ways – it could have been worse – seen the S2 and S3 levels as per – had the S1 broken – but then that’s the magic of Fibonacci.

 

 

R3 3048 against 3406 on Friday
R2 2989
R1 2931
Pivot 2870 against 2985 on Friday
S1 2812
S2 2751
S3 2693 against 2564 on Friday
Projected High Range 2901 to 2960
Projected Low Range 2897 to 2838
Fib Projected High 2961
Fib Projected Low 2777

 

Best of luck everyone… Hope you make money

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