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…