The present… and the Future Update for 20 Feb 09

I am really wondering whether the amount of work I am putting in on studying the markets for whatever they are worth is worthwhile the effort. A lot of people are as it is out of the markets and the way the things are going there seems to be no end of the bad times in the stocks around the world. The participation has trickled down like any thing. The only people who are making risk free money in the markets are the brokers. The times are bad indeed. No one – even the markets perhaps know where to go from here. On day a point up and one day a point down. The charm of making – or even loosing money in the markets is just not there. The entire day if you spent staring the markets and the markets are not even kind enough to move 50 points worth on nifty – is the sign of the tired and bored markets. The markets are still stuck to the narrow band. It was perhaps a misnomer that the markets are trying to break the narrow trading band they have been caught up in. I do agree that this band has become so predictable that it can be played by the traders but the width of the markets are so small that it would be a pain I guess. On day a point up and the other day a point down. So I will not waste any time and get one with the markets.

The global cues are as confused as we are in these times. The good news is just not there and the bad news has become too boring for the markets to react on. Asia has both the red and the green ticks. Nikkei closed 0.31% up, Hang Seng Flat at 0.06% green and Strait Times down 1.31%. Europe followed the suite with FTSE up 0.29% , Dax up 0.24% and CAC down 0.05%. US opened green but now in its mid session has slipped in red and is trading – Dow down 0.58%, Nasdaq down 0.7% and S&P down 0.39%. With the kind of swings that we are seeing in the markets it is extremely difficult to predict where the markets are headed towards and it will be only after the markets end that we will come to know how exactly the markets performed.

The second day of the candle has again been a small white one but believe me I am not impressed at the moment. Combining the bodies of both the candles is not enough to pierce the last black candle we had so it conveys nothing really. Next we are in the middle of the Bollinger bands and they too do not point out in any direction and so the markets can face and move a few steps in any direction they wish. 5 EMA is below the 20 EMA and 20 EMA is below the 50 EMA so Negativity in the markets remain. The ADX is bearish but as I have been saying so many times before that when the markets start falling the ADX line loses strength. So I remain firm with my thought process. the markets should go to higher levels first before touching the lows expected out of it. MACD is negative and bearish – TRIX is flat but perhaps looking down a wee bit. RSI has looked up again after being beaten down. In the last three months the RSI has not really collapsed below the 30 marker and that is good. Volumes? Don’t even ask me. They are thinner than the thinnest milk delivered by my “Doodh wala” ever. Just falling every day.

The entire game i now of 30-50 points on nifty and on the last two days the markets are just fighting it out to protect the pivot levels. The range today was between the R1 (never touched) and the pivot – where there  was a half hearted attempt to break it.

Let us see the pivot levels for whatever they are worth:

R3 2837 as against 2876 yesterday
R2 2821
R1 280
Pivot 2786 as against 2772 yesterday
S1 2770
S2 2751
S3 2735 as against 2669 yesterday
Projected High Range 2795 to 2813
Projected Low Range 2791 to 2773
Fib Projected High 2811
Fib Projected Low 2757

Best of luck for tomorrow – there may be some move tomorrow as it is the last trading day of the week and then we have a week end. Cheers.

And hey do not miss the laugh in the post below this one.