Monday, January 19, 2009

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 earningsclip_image001 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.daily charts 18 Jan 09

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…

Dialy 19 Jan 09