Smart Analysis

test

2009-10-05T12:54:00.000-07:00

Shorting is common sense now !!

2009-06-15T20:12:00.000-07:00

- US markets ended Lower
- SGX Nifty down
- Indian Markets were up from so many weeks and were looking tired and closed lower in last 2 days .

What does that mean ? SELL on small upbounce with tight stop losses . No great analysis needed here . Just short !! .

Wait for BUY , Sell on pullbacks

2009-06-14T20:40:00.001-07:00

The Pivot for nifty today is around 4535 . SGX Nifty is trading about those levels and India Markets are also expected to go lower today as other Asian markets are also trading lower .

Nifty seems to be tired now and it would be a healthy for it , if it corrects itself now , otherwise it will become more vulnerable for a big and sudden fall later .

If you see 9 months chart , ADX seems to be falling now from many days indicating that its tired now and the momentum is declining .

If you are looking for buying , wait for short term . If you want to short , do it on pullback on intra-day .

Markets near strong resistance , Call for Friday June 5

2009-06-04T11:42:00.000-07:00

Markets went down today in the start and then bouced back . A small positive divergence was visible on MACD and RSI . It was worth taking a long shot because the prices were near the low of 2 days and hence a bounce back was expected .

Markets rallied then and didnt stop .. It closed near days high and at very important and strong resistance levels of 4570 levels . I am personally not very bullish , but i will change my mind if markets show me that i am wrong .

Better to make long positions only if markets move above 4600 and buy on a small 20-25 points dip on intra-day level . Go short if markets start moving down from here with tight stop losses .

Market update 3rd June Wednesday

2009-06-02T20:33:00.000-07:00

US markets are up marginally and SGX nifty is also up . we are near very important resistance level now . Momentum Can take this rally to 5000 levels or the correction can take it to 4000 levels again where it can again be a good buy for long term investors . NIFTY PE stands at 21 which is the main discouragement for long term investors

S2 4385.85
S1 4455.5
Pivot *4520.95*
R1 4590.55
R2 4656

What can be done now ?

I believe that trades should be taken on trend basis now , dont fall in that trap of catching the top of bottom and get maximum out of markets , better to go with it .

Buy when 50 EMA crosses above 200 EMA and sell otherwise .

Update for Thursday , May 28

2009-05-27T07:14:00.000-07:00

Markets closed just above important resistance levels of 4270 . Tomorrow is expiry day and bias is on upside now .

- US markets are trading Flat .
- GM is close to bankruptcy .

I expect market to open flat tomorrow and it might start its upmove towards R1 levels of 4337 .

R2 4,397
R1 4,337
Pivot 4,226
S1 4,165
S2 4,055

I expect market to open flat to low and then start its upmove high. I am planning to avoid trading tomorrow . People who want to trade should buy at dips only and that too for June series . Last day of expiry can be very risky .

DOJI again creating confusion for market , better to trade light this week

2009-05-25T11:16:00.000-07:00

wooo ....

This is a strange day :) .. The pivot for tomm is same as close today :) . Nifty is making some DOJI these days inclding one today .

If you see 6 months charts of nifty , ADX is declining suggesting the weakness in trend , Its not a signal to SELL , but just to be cautious :) .

Better to trade light now !! , Dont take short positions just now , but wait for the moment and dont get caught in the madness of panic buying , This time if markets move fast and break 5000 mark , It would be wise to then wait and look for shorting opportunities .

At the time of writing , US markets are flat with little down moves . Markets are too confused all over the world on direction

Important Levels for Tomorrow

R2 4,303
R1 4,270
Pivot 4,238
S1 4,205
S2 4,173

Strategy

- Better to trade light tomm (actually whole week because of expiry) .
- Better to long positions based on oscilators signal (buy when RSI and Stocastics dip to oversold).
- BUY only above Pivot .

Disclamer : I hold a 4100 CA bought at 140 and it closed at 152 today . Looking to carry it further if its in profit , else i will sell it once Nifty hits below 4200 .

Market View for Monday 25th May

2009-05-24T10:31:00.000-07:00

Next week is Expiry week .

Markets have made spectacular moves this month after elections result and looks extremely overbought and bullish both . What does that mean ?

I am not saying markets may not go up more , there is no limit of insanity and emotional buying . But understand that this is the time to be extremely cautious . If you buy emotionally and put a big chunk and then market reverses back telling you that this was just a big rally in bear market . Your money will be stuck and you may take big losses .

Markets are consolidating and it resting before moving forward . Be patient and wait for the right opportunity to buy . This is from long term investing point of view . If you are short term trader with 1-2 days of time frame , what i just talked about may not be relevent for you .

Trade lightly this week because of expiry .

Pivot Levels for Monday 25th May

R2 4,308
R1 4,273
Pivot 4,215
S1 4,180
S2 4,121

Strategy for Monday

- Buy if markets open above Pivot levels .
- If markets open below pivot BUY only only when it reached support levels of 4160 .
- Better not to short now as it has already been in red for some days in this strong upmove .

- Have logical Stop losses .
- Control your losses .
- Dont prematurely book your profits thinking that you will loose what has already come to you .

Market Update for Thursday , Mar 21

2009-05-21T08:44:00.000-07:00

As I write this , DOW is 140 points down .

There is suddendly this bearish environment all over the place . Indian markets are down for last 3 days including today . We are near important support levels of 4170 now and breaking that would mean , bears coming back in the game for short to medium term .

We should not understand that we are in a bear market till now and may be markets have made its top for the rally . That is a possibility . But confirmation would come only after some days . Next week is expiry and that makes it more difficult to predict what can happen . Better to wait on side lines now till a clear trend emerges .

Nifty Pivot levels for Friday 21 may :

R2 4,363
R1 4,287
Pivot 4,243
S1 4,167
S2 4,123

I expect market to open flat to a bit high and then move lower .

20th May , Thursday call

2009-05-20T10:47:00.000-07:00

What happened on Wed , 20 May

- Profit booking
- Huge Volumes
- Close before the pivot of the day
- Choppy day
- Moving towards support of 4200 level .

The over all trend is UP , and its strong !! . But correction can also not be ruled out , Markets are resting for some time only to move up again . So what should be strategy for tomm .

Pivot levels for Thursday are

R1 - 4341
Pivot - 4293
S1 - 4222

I expect Nifty to open flat to negative tomorrow , what should be the strategy tomm .

- If markets Open flat , then go with the direction after 10 min
- If markets open low near levels of 4200 , dont look for shorts then , look for Long opportunities
- If markets gap up in opening, then you must see other factors like current news , asian and european markets . Better to take shorts only for intra day and not carry them .
- If you are trading in options , better to go for In the money options and not out of money options . use 4000/4100 CA or 4500/4400 PA .

Are you a new or Struggling trader , read this chat

2009-05-20T05:38:00.000-07:00

Below is a chat between me and a new and struggling trader . If you are also a new or struggling trader . Read the chat below .

plugoo: [My Plugoo] [MAB] hi
manish_chn: hi
plugoo: [MAB] who is this
manish_chn: I am Manish Chauhan
manish_chn: owner of http://www.jagoinvestor.com
manish_chn: How are you doing
plugoo: [MAB] hi manish...i m a regular reader of jagoinv.
manish_chn: Great !! , how are you finding this posts
manish_chn: I hope they teach you something
manish_chn: What you name ? MAB ?
plugoo: [MAB] its really useful for me..even though i am a trader..i was rather ablind shooter..
plugoo: [MAB] Binoy MA...thas my name
manish_chn: ok
manish_chn: you should read my TA blog
manish_chn: I give some insight on markets there
manish_chn: anywyas .. jagoinv is also a must read for anyone
plugoo: [MAB] now i am trying to learn from ur writings..
manish_chn: great !!
manish_chn: don't buy or sell blindly
manish_chn: it takes years to understand how to make money consistently
manish_chn: stop and first learn a lot
manish_chn: may be for 1 yrs
plugoo: [MAB] yu r right...
manish_chn: yes
manish_chn: I have been trading for last 1 yrs and believe me , I am still struglling
manish_chn: I am still in loss
manish_chn: and still I can't make consistent money
manish_chn: I have learned a lot
manish_chn: and now I am improving
plugoo: [MAB] wht hapnd with me was ..i make some gud profit as a short term trader.
plugoo: [MAB] then i started day trading ..idont know whether i can term it day trading..its called intraday in indiabulls ...ur position will be squared of at around 3. or 3.10 automatically...
plugoo: [MAB] here i loss everything...
plugoo: [MAB] i made before..
manish_chn: hmmm
manish_chn: yea its called day trading
manish_chn: and its leveraged
manish_chn: you buy 100 by just paying 20
manish_chn: correct
plugoo: [MAB] even today also i played with icici....i bougth at 720..then it touched 731..then my greed told me to wait..then it dived to 700...n finally i book loss at 708..
manish_chn: hmm...
manish_chn: why did you buy ? today
manish_chn: I am sure you bought it because it went below 710 and then when it went upto 720 , you thought that its now moving up
manish_chn: and didn't want to be left out
plugoo: [MAB] so i m planning to stop day trading...its just blind shooting for me..i dont know any tech. analysis...from my observation i learned that icici is a very good price swinger..
manish_chn: and hence you bought , correct
plugoo: [MAB] ur absolutely correct
manish_chn: :) hehe
manish_chn: you know , it takes years to understand this thing
manish_chn: I will teach you this thing just now
manish_chn: and already remember it
manish_chn: you are not able to differentiate between volatility and actual price movement
manish_chn: keep saying "hmmm..." or "ok" so that I know that you are reading
plugoo: [MAB] yea ..whjt i think gud for me is delivery base buy..in cash..not intraday
plugoo: [MAB] wht do u think
plugoo: [MAB] ok
manish_chn: no

manish_chn: its not like that
manish_chn: may be yes , its not for you
plugoo: [MAB] then
manish_chn: but at this moment you are not succeeding becuause you are not doing it correctly
plugoo: [MAB] hmm
manish_chn: first you have to undetrstand what is day trading
manish_chn: and how is it done
manish_chn: what are important things for day trading
manish_chn: the first thing
manish_chn: did you know before markets opened , that what was the mood of market toay
manish_chn: and what was it expected to do ?
plugoo: [MAB] ok
plugoo: [MAB] yea
manish_chn: tell me
plugoo: [MAB] i look for previous days
manish_chn: what was the mood
plugoo: [MAB] us and EU markets
manish_chn: did you know that markets have gone so much up and profit booking is expected
plugoo: [MAB] EU was plus
manish_chn: and market mood for today was to book profit
plugoo: [MAB] yea manish..that inteligence also back fired on me..
manish_chn: one thing always understand
manish_chn: today icicibank was coming down
manish_chn: and you were buying
manish_chn: you were against the trend
manish_chn: trend was down (for today) and you are a day trader
manish_chn: so logically you have to ride the trend
manish_chn: so if its going down , sell .
manish_chn: if its going up , buy
plugoo: [MAB] post election when market went 2000+ i thought next day there will be a profit booking..hence next dat i short on icici..but to my sadness..i found that only icici was moving up
manish_chn: arre no
manish_chn: you are doing it totally wrong way
manish_chn: don't fight the trend
manish_chn: this is extremmelly important
plugoo: [MAB] really man...
manish_chn: you need to first stop
manish_chn: and take some break or vacation
manish_chn: because I guess currently you are so much exhayusted with all the losses and frustration
manish_chn: :)
plugoo: [MAB] wht ever i do in daytrading..it seems that market has eyes and it watches me an do what exactly opposite to it
manish_chn: happens with all
manish_chn: :))
manish_chn: same happens with everyopne
manish_chn: I can see myself in you :)
manish_chn: this all has happened with me too
manish_chn: and I have made some amazing losses
manish_chn: I have don't worst trading of all
manish_chn: done
plugoo: [MAB] so whts ur advice for me..
manish_chn: ok
manish_chn: how much have you losr
manish_chn: lost till now
plugoo: [MAB] in 3 months 26K
manish_chn: hmm
manish_chn: total = 26000
plugoo: [MAB] not much ha!
manish_chn: correct
plugoo: [MAB] no man..its huge for me
manish_chn: hmm.. ok
manish_chn: may be its huge
manish_chn: one thing is
manish_chn: you have tio understand that this is a place where you are trading against professionals and people who have decades of experience
manish_chn: so you have to accept that it has to be damn tough
manish_chn: making money from markets is not childs play
manish_chn: I am not talking about 1 or 2 day profit
manish_chn: I am talking about consistent profit
plugoo: [MAB] ok..
plugoo: [MAB] so should i stop..?
manish_chn: so , what do you want to do
manish_chn: are you doing it for time pass
manish_chn: or are you here to make some money and then leave
manish_chn: is it your side hobby kind of thing
manish_chn: if I ask you , do you seriously take it or take some effort for it , will your answer be "yes"
plugoo: [MAB] very much YES
manish_chn: ok
manish_chn: do you want to make a career out of it
manish_chn: like leaving your job and doing this seriously \
plugoo: [MAB] do u know form one of your atricles ..today i down loaded a study material on technical analysis..
manish_chn: or even if you don't leave your curretn job , will you do it as your business
manish_chn: ok am great
plugoo: [MAB] without leaving my job..but like a parellel job..
manish_chn: Binoy , I am sure that you understand that you have to work hard and learn
manish_chn: but I thikn you still underestimate the effort you have to put here
manish_chn: have you read some books
manish_chn: what do you know about technical analysis
manish_chn: or physcology of trading
plugoo: [MAB] "0"
manish_chn: hmm.. see, and you say that you are serious
manish_chn: may be your are serious mentally , but not from your actions
manish_chn: first stop trading for time being
manish_chn: and learn
manish_chn: becoming trader is just like becoming a doctor or pilot or engineer
plugoo: [MAB] hmm
manish_chn: you have to do the course
manish_chn: and that you have to do your self
manish_chn: and give time to it
manish_chn: it may look vert easy , because its only BUY or SELL
manish_chn: but you have seen , how difficult it is
plugoo: [MAB] yea..i have seen it
manish_chn: I am sure you will have some fundamental problems
manish_chn: like
plugoo: [MAB] let me tell u one thing...
manish_chn: You keep your looses going on and hoping that they will come back
plugoo: [MAB] ok tell me..sory to interupt
plugoo: [MAB] yea..
manish_chn: yeah , tell me
plugoo: [MAB] i am doing trading for the last 1 year...i started when market was around 18K+
manish_chn: k
plugoo: [MAB] i sit with experts in front of the trading terminal in the Arcadia ...
plugoo: [MAB] there i make some gud profit some arnd 20K
manish_chn: where do you work ?
manish_chn: what's arcadia
plugoo: [MAB] Arcadia is like Indiabulls, geojit..sherkhan..a brocker firm..so they had the realtime terminal..
manish_chn: who are these experts you are talking about
plugoo: [MAB] n they daily get gud tips..an almost all of it will work..so i made profit there..
plugoo: [MAB] then leave them ..started my own in indiabulls online trading without getting any tips n hints..
plugoo: [MAB] now i started to be in loss...
plugoo: [MAB] just one month back only i came acroos ur jago invester
manish_chn: hmmm
plugoo: [MAB] then only i take learning in trading dseriously..
manish_chn: hmm..see , first thing is it's a good thing not to be dependent on some one tips
plugoo: [MAB] i gone through all ur blogs soince 2009 jan..i copied to all those relate to trading into my harddisk ...
manish_chn: and they will stop working some day
plugoo: [MAB] so my point is ..i have just started lerning..
plugoo: [MAB] now u may continue..i m listening
manish_chn: ok , I got your point
manish_chn: see , if you want to become a trader and learn things your self
manish_chn: its a very tough path
manish_chn: but its achaievable
plugoo: [MAB] oh..
manish_chn: what ohh
plugoo: [MAB] tough pah..made me oh..
manish_chn: not only tough , but extremmly tough
manish_chn: I mean , to become a good trader
manish_chn: who makes money consistently
plugoo: [MAB] ...but i think i can...
manish_chn: yes , why not
manish_chn: you can
manish_chn: I can
manish_chn: any one can
manish_chn: who is ready to do it
manish_chn: :)
manish_chn: so learn trading first
plugoo: [MAB] wht i hv to do it for that..stay away frommarket n..learn n come back after some time?
manish_chn: and believe me , you have to give atleast 1 yr
manish_chn: no
manish_chn: be with the market , but don't trade
manish_chn: don't trade real money
manish_chn: trade on paper
manish_chn: note down when you buy and when you sell
manish_chn: make your notes of trae
manish_chn: trade
manish_chn: have you made notes of your trades
manish_chn: ?
manish_chn: what is your average loss per trade
plugoo: [MAB] thats a gud sugg..but the problem is in paper when u make money..may feel sory that its not the real one..
manish_chn: yes
manish_chn: this is one big problen
manish_chn: but why didn't you tell me that one good thing about paper trading is tat when oyu loose money on paper you are happy that it was not real
plugoo: [MAB] in day trade..i make an avg loss of 1000+ or - per day
manish_chn: this is psychological
plugoo: [MAB] but profit is avg 400,500 etc
manish_chn: which city are you in ?
plugoo: [MAB] i m from kerala..
plugoo: [MAB] now at kuwait
manish_chn: ok , if you were in bangalore , I could have coached you
plugoo: [MAB] hmm
manish_chn: anyways
manish_chn: so first learn for some time . read books
manish_chn: see the markets
manish_chn: try to learn some technical analysis
manish_chn: do you read sudarshan shukani
manish_chn: or breet steenbarger ?
plugoo: [MAB] but u said in ur blog tech. anlss is just 10%
plugoo: [MAB] but can;t be avoided hah?
manish_chn: yes
manish_chn: I mean ... it's a tool
manish_chn: you better have it withy oyu
plugoo: [MAB] hmm
manish_chn: let me ask you simple
manish_chn: q
manish_chn: if you buy some thing at 720
manish_chn: and it starts to go down
plugoo: [MAB] ok
manish_chn: say 715
manish_chn: what do you say to your self
plugoo: [MAB] it will come back n bring u to profit
manish_chn: yes
manish_chn: and may times it happens
plugoo: [MAB] n more time the other way arnd
manish_chn: so you must say that I know that it will go down to may be 680 but eventually it will come back and give me profits
manish_chn: and some times you know that it will really go to 680
manish_chn: correct
manish_chn: with high probability
plugoo: [MAB] hmm
manish_chn: so why don't you then sell at 715 and then wait for it go go more down and then buy it back at that levels
plugoo: [MAB] u mean to say there i need tech . anlss
manish_chn: the most important element which is missing in your trading is "no control on losseS"
plugoo: [MAB] ur right
manish_chn: I will tell you simple thing
manish_chn: if you trade 10 times
manish_chn: how many times will you loose
manish_chn: ?
manish_chn: around 5 times
manish_chn: even if you are a bad trader sometime you aer lucky and you make priofits half times
plugoo: [MAB] yea
manish_chn: so say your equity is 1 lacs
manish_chn: and you make 10 trades
manish_chn: each time you say that I will take max loss of 600 or 700
manish_chn: not more than that
manish_chn: evn if you loose all 10 times
manish_chn: you will loose 7-8k
manish_chn: out of 1 lac
manish_chn: that's 7-8% loss
manish_chn: if you control all your losses
manish_chn: what I am trying to say is losses are like wounds on body
plugoo: [MAB] yea..sounds intersting
manish_chn: if you take care of it in early stage
manish_chn: and don't let it grow
manish_chn: you can take a lot of them
manish_chn: and still you will be healthy
manish_chn: and it won't pain
manish_chn: but if you leave even one or 2 wounds open and don't take care of it
manish_chn: it can kill you
manish_chn: its not looses which are your enemies
manish_chn: its uncontrolled losses
manish_chn: losses which you allow to grow
manish_chn: loss comes , cut it
manish_chn: loss comes , cut it
manish_chn: loss comes , cut it
plugoo: [MAB] hmmm
plugoo: [MAB] gud read
manish_chn: then
manish_chn: profit comes , wait for it to grow
manish_chn: I know the temptation to take the profit
manish_chn: you are so worried that it will go away
manish_chn: its psychological
manish_chn: its in your mind
manish_chn: prices don't know that you are thinking that it will come down
plugoo: [MAB] even if it was known the expectation that it it will come to ur profit region prevents from booking loss
manish_chn: you know, your total mind thinking and attitute towards trading needs a change
manish_chn: you need to look it in a fresh way
manish_chn: have a new start
manish_chn: if you succeed in trading , you can make all the money in 3-4 yrs , what you want to make in your life
manish_chn: I mean you can make excellent money
manish_chn: that's enough motivation to try this
plugoo: [MAB] i think like saying 'no' is the must lernt thing inlife..in market booking profit is the basic thing is in market
manish_chn: :)
manish_chn: controling losses and letting your profits run is the key
manish_chn: one last thing ..
manish_chn: understand volatility and actual trend
manish_chn: when prices start going up , do you think that prices are not reversiing
manish_chn: ?
plugoo: [MAB] hmm..
manish_chn: when prices are declining
manish_chn: obviously in betwwen , it will also go up
plugoo: [MAB] so?
manish_chn: there are many people who want to take thjere profits
manish_chn: so you have to understand that it is a correction in a downtrend
manish_chn: like today
manish_chn: with your ICICI
manish_chn: the time when you biought , it was actually a time to sell
plugoo: [MAB] hmmm..
manish_chn: it was an opportunity to sell so that you can take 12 point profit
manish_chn: http://in.finance.yahoo.com/q/ta?s=ICICIBANK.NS&t=5d&l=on&z=l&q=l&p=e50,e200&a=m26-12-9,r14,ss&c=
manish_chn: see this
manish_chn: see the green line
manish_chn: tthats 200 MIn ema
manish_chn: that's the average price over 200 min
manish_chn: noe that's down
manish_chn: not even a single time in a day it was moving up
manish_chn: its direction is only down
manish_chn: that shows that the trend is down andhence bearish
plugoo: [MAB] my god..
manish_chn: any up move should be treaded as opportunity to sell again
manish_chn: :)
plugoo: [MAB] hmmm..
manish_chn: I know you must be thinking that its so obvious , why didn't you see it
manish_chn: but its too tough ..
manish_chn: poeople can't see obviuos things
plugoo: [MAB] so whts ur tip to me as day trader..
manish_chn: first unjderstand , that are you a day trader ?
manish_chn: are you really a day trader
manish_chn: do you have time for it
plugoo: [MAB] :(
manish_chn: or would you like to be a position trader
manish_chn: who buys today and sells after 2 days
manish_chn: or 5 days
manish_chn: or 10 days
plugoo: [MAB] yea...
plugoo: [MAB] position trader is i m better explained i think
manish_chn: see
manish_chn: you are doing wrong thing from te start then
manish_chn: you have married a trading way which you are not comfortable it
manish_chn: better to divorce
plugoo: [MAB] i will if i hsve to
manish_chn: and start to understand this new way you are comfortabl with
manish_chn: :)
plugoo: [MAB] new way..position trader?..
manish_chn: hmm
manish_chn: yes
manish_chn: so stop for some time , better go away for some time
manish_chn: not come back until 1 month
manish_chn: to market
plugoo: [MAB] ok
plugoo: [MAB] .....
manish_chn: and then learn
manish_chn: practice
manish_chn: and read some good people
manish_chn: like Breet
plugoo: [MAB] like u hah? :)
manish_chn: traderfeed.blogspot.com
manish_chn: how do you find me
manish_chn: ?
manish_chn: am I a good motivator
manish_chn: ?
plugoo: [MAB] u really r!!!
manish_chn: :)
manish_chn: thanks
manish_chn: but its extremmelly tough to follow things ourselves
manish_chn: I still do mistakes , but I learn from them
plugoo: [MAB] hmm..
manish_chn: and have confidence
manish_chn: don't loose heart
plugoo: [MAB] can i add u to my google talk if u dont mind if u have a gmail id
manish_chn: if you start making losses again or its tough
manish_chn: manish.pucsd@gmail.com
manish_chn: manish_chn@yahoo.com
manish_chn: talk to me anytime you need help
plugoo: [MAB] ok..
manish_chn: go to my shelfari page
manish_chn: and see all the books I have read
manish_chn: on trading
manish_chn: read those
plugoo: [MAB] ur my motivator , teacher since one month..n friend from today ..ok..
manish_chn: :)
manish_chn: sure ...
manish_chn: talk to other traders
manish_chn: know how they think
manish_chn: learn and teach
plugoo: [MAB] ok..
manish_chn: spread knowledge
plugoo: [MAB] sure..
manish_chn: so
manish_chn: one thing
manish_chn: do this
plugoo: [MAB] u r a full time trader..i mean ur job
manish_chn: nah man
manish_chn: I am a software eng
manish_chn: and I want to make acareer in trading
manish_chn: I trade part time
plugoo: [MAB] part time means...how often
manish_chn: and I am still a failure but not I am very close to success
manish_chn: I think that
manish_chn: now
manish_chn: now I have learned things
plugoo: [MAB] whts ur trading pattern
manish_chn: and from past some month things are in contrl
manish_chn: I trade options
manish_chn: not stocks
manish_chn: and one thing .. don't get into derivatives in start
manish_chn: no futures or opionns for some tne
manish_chn: once yu can trade stocks , then think about derivatives
plugoo: [MAB] ok..
manish_chn: so if ICICI opns stronger tomm
manish_chn: and starts moving up
manish_chn: then BUY
manish_chn: and sit tight
manish_chn: and don't involve your emotions in your decisions
manish_chn: buy , and keep some stop loss and leave ]
manish_chn: I know you keep looking at your screen every 20 sec :)
manish_chn: correct :)
plugoo: [MAB] :)
plugoo: [MAB] mazbooth
manish_chn: what?
plugoo: [MAB] really
manish_chn: and the moment prices go rs 1 below your buy , you seem to feel bad and think "should I sell"
manish_chn: you just want it to go up only
manish_chn: and never down
plugoo: [MAB] i read that u really enjoy options..still i hv no idea abt options.n fututre..i hv downloaded ur article..not get time till to read it..
manish_chn: hmmm
manish_chn: ok
manish_chn: but for now , don't get into it
manish_chn: ekse it will become comples
manish_chn: be with stock trading for now
manish_chn: and get into derivatives later
plugoo: [MAB] ok..i will not
manish_chn: just to let you know and make you greedy
manish_chn: icici options yesterday were at 4
manish_chn: and by end it was at 40
plugoo: [MAB] is the stock trading is inferior to options n futures
manish_chn: so 10k invested at 4 was rs 1 lac after some hrs , same day
plugoo: [MAB] hmmm
manish_chn: that happes in options
manish_chn: but don't tink abut it
manish_chn: its too risky
manish_chn: if you invest 10k in stocks and loose 500 in it
manish_chn: in opiotns its can be 10k investment and 9k loss the same day
manish_chn: or 10k loss
plugoo: [MAB] oops!!..
manish_chn: some times in 5 min
plugoo: [MAB] hmm.
manish_chn: so stay away .. trade stocks for now
plugoo: [MAB] so u dont trade in stock...
manish_chn: no , I don't trade in stocks
plugoo: [MAB] hmm
manish_chn: I trade optons
manish_chn: bcause I started with options only in market
manish_chn: and that was a huge mistake
manish_chn: but now I have learned so much that now I can afford to keep trading in options and learning
plugoo: [MAB] u didnt trade stocks at all?
manish_chn: nah .. just once or twice
manish_chn: but that too was in loss only
manish_chn: but first stock trade and first option trade was in profit
manish_chn: :)
manish_chn: and that increased my belief that "I am becoming a millionaire next year" , trading is easy
manish_chn: far from truth :_)
plugoo: [MAB] is the stock trading is inferior to options n futures
manish_chn: what is the meaning of inferior ?
manish_chn: what do you say inferior
manish_chn: ?
manish_chn: stocks tradig is less complicated , less rewarding and most importantly "extremmely less RISKY"
plugoo: [MAB] its like...is there anythink like..biggies, n experts only do options n futures..stock is for small ppl..something like that?
manish_chn: nah
manish_chn: nothing like that
manish_chn: most people trade stock only
manish_chn: options are mainly hedging tools and some advanced pepoep trade them
manish_chn: but its not easy at all
manish_chn: its all about your risk appeitite
plugoo: [MAB] hmm
manish_chn: if you want to make 10k by invest 5k in 2 days , but you are ready to loose it all
manish_chn: then go trade options
plugoo: [MAB] i c
manish_chn: take it from me , don't get into optiosn soon
manish_chn: trade stocks and be happy
manish_chn: options will come later
plugoo: [MAB] not at all..
plugoo: [MAB] i humble target is 500 rs per day..
manish_chn: what is your trading capital
plugoo: [MAB] 50K
manish_chn: grreat
manish_chn: then its posisible
manish_chn: how much do you put in one go
manish_chn: how much is your capital in market at one time
manish_chn: what are your moneymanagemetn rules
plugoo: [MAB] :)..no rules yaar...total anarchy..
plugoo: [MAB] i m familiar with some stocks..like icici,unitech,rnrrl,rpl,sbi, ivrl prime..etc..i so i just buy on dips...to an extent of 40K total..
manish_chn: no !!
manish_chn: see , you are making mistake again here
manish_chn: you are putting a lot of your money at one point
manish_chn: 50k is your capital
plugoo: [MAB] right
manish_chn: don't put more than 10k at one time
manish_chn: and be consisent eith it
plugoo: [MAB] !!! r u sure
manish_chn: yes
manish_chn: no more than 15k max
manish_chn: you do day trade , correct
manish_chn: so you are using leverage
manish_chn: you can buy 50k worht of stocks with 10k
manish_chn: correct
manish_chn: ?>
manish_chn: do you use margin
plugoo: [MAB] hmm
manish_chn: yes or no
plugoo: [MAB] margin...i dont know..
manish_chn: ok , so when you put a trade
manish_chn: why you buy
manish_chn: when you buy something
manish_chn: there is an ioption if you want to buy on margin or not
manish_chn: so you give just 20 and you will get 100 worth
plugoo: [MAB] whts that
manish_chn: see margin trading
manish_chn: see , you don't have any knowledge of basics and you are doing one of the toughest things in world , i.e "Day Trading"
manish_chn: you are not prepared
manish_chn: better you read some good books first
manish_chn: :)
plugoo: [MAB] yea i m not...
manish_chn: sorry to be straight forward
manish_chn: but I talk staright :)
plugoo: [MAB] i like it that way..
manish_chn: ok
plugoo: [MAB] ur welcome
manish_chn: so you are not prepared and the worst tihng is you didn't know it :)
manish_chn: so go back and come after preparation
manish_chn: read timamo , sudarshan sukahni and breet
plugoo: [MAB] so to get the abcd of trading..what i should read first
plugoo: [MAB] first
manish_chn: first go and read breet stenbarger
manish_chn: his articles
plugoo: [MAB] ok...
plugoo: [MAB] i mad u waste ur valued time..
manish_chn: http://traderfeed.blogspot.com/2006/04/ten-lessons-i-have-learned-from.html
manish_chn: he writes a lot fof articles on general wisdom
manish_chn: see his archives
manish_chn: look at posts which related to you and ignore the technical ones
manish_chn: posts like these
manish_chn: http://traderfeed.blogspot.com/2006/04/ten-lessons-i-have-learned-from.html
plugoo: [MAB] sure...thks for that...
manish_chn: and read timamo.blogspot.com
manish_chn: and read me too ;)
manish_chn: but they are the best ... I am just puttng somr random thoughts
manish_chn: :)
plugoo: [MAB] i tried that from the link u provided in ur blog..its lil boring..timamo
manish_chn: why ?
manish_chn: he puts so many graphs and things
manish_chn: may be you can ignore him for time being
manish_chn: you first get basics
manish_chn: explore
manish_chn: :)
manish_chn: make a lot of mistakes yourself
plugoo: [MAB] yea..i m just a beginner n i need basics
manish_chn: that's the best source of learning
plugoo: [MAB] :)
manish_chn: else its very tough to learn from here anf there
manish_chn: :)
manish_chn: make notes for each trade
manish_chn: and see it later , what you did wrong
plugoo: [MAB] hmm...
manish_chn: I have all the trades from last 5-6 months
manish_chn: with charts and all the data
manish_chn: my trades
manish_chn: and I am consistent :)
manish_chn: consistent in making LOSSS :))
manish_chn: =))
plugoo: [MAB] consistency is the key
plugoo: [MAB] :)
manish_chn: but that will change :)
plugoo: [MAB] as beginner do u think breet stenbarger;s read are gud for me..
manish_chn: yes
manish_chn: I am not talking about his technical posts
plugoo: [MAB] ok.gud
manish_chn: which talk on markets
manish_chn: see his posts which talk about general things
manish_chn: like the post I gave you
plugoo: [MAB] hmmm
manish_chn: you will have to go through each of them
plugoo: [MAB] i understand..
manish_chn: and start reading it and decide if it will help you or not
manish_chn: see all his archives
manish_chn: Can I put this chat on my blog
plugoo: [MAB] ok..
manish_chn: not on jagoinvestor
manish_chn: but my TA blog
manish_chn: it help help others like you to leant
manish_chn: learn
manish_chn: I hope that's fine with you
plugoo: [MAB] not an issue..but who need this ..
manish_chn: hehe .. everyone is like you
manish_chn: I mean most of them
manish_chn: you are not alone :)
manish_chn: many people will read
manish_chn: infact I also learnt some things myself here :)
plugoo: [MAB] ok then now no probs..its my ppleasure...
manish_chn: ok thanks'

DOJI comes to rescue the bears

2009-05-19T07:12:00.001-07:00

As per NSE website :

NSE is the 3rd largest Exchange in the World in terms of number of trades in the Equity Segment. Today further landmark was reached with record number of trades, volume traded and number of shares traded in this segment at NSE.

The turnover in Cash segment on 19th May was Rs 40,000 Crs, surpassing the previous high of 28,476 Crs on 1st Nov 2007.
Number of trades touched an all-time high of 1.12 crores (1,12,60,392 trades). Similarly number of shares traded was in excess of 1.92 billion. In the Currency Segment for a 2nd day in row, NSE clocked more than 1 million contracts. The segment clocked USD 1.06 billion (Rs.5090.80 Crs) on May 18, 2009 and over USD 1 billion (Rs. 4845.72 crs) on May 19, 2009.

Lets see last 2 days action

If you see today's volumes , it was highest ever and was more than double of the average volumes from many days . That tells that there was a huge participation today . We can see that there was a DOJI made today on daily chart , DOJI tells us that there is uncertainty in markets . DOJI with strong volumes means strong uncertainty , Markets went up to 4500 and then reversed from there on profit booking , 4500 is also a good resistance level point if you see 2 yrs charts .

IF you see previous day chart , There was almost no volumes , and there was great price action . This rise in index looks weak to me , It has come up too fast , It needs rest . I expect it to consolidate around 4000 levels , because thetas the logical levels for it . After a correction , markets must go up again .

Be Greedy , Be Cautious , Be Logical

2009-05-18T09:09:00.000-07:00

Markets are up 650 points on nifty , this has never happened earlier . Everybody is trying to rush in . and smart people will now try to take some profits home .

Be Greedy : The main aim should be to BUY !! , and not SELL . Whenever you get opportunity , which should happen on intra-day dip , Enter long positions .

Be Cautious : Why do I say this ? Because now smart people will try to take some profits home . Markets mood is positive and it should go up , but that does not mean markets will not fall , it may not fall tomm , but eventually it will fall upto some level , so dont be the culprit of buying at the highest point , there will be better opportunities .

Be Logical : Markets have started there up journey before 10 weeks and after this mega positive news , again it should move higher , but till when ? Some day it will fall ... If you are carrying some positions from some weeks back this is a good time to Book at least partial profits . And then go long again at lower levels .

So whats the plan for Tuesday ?

- If markets open Higher and starts dancing zigzag , better to book profits , or Wait before going long , a profit booking can come .

- If markets open lower , then go long

- If markets open flat, wait for 10-15 min and then go with the flow if it goes up , if it goes down , don't short , just wait for it to go down and then move up .

Go long with Nifty options

2009-05-17T04:06:00.000-07:00

Now after UPA has come to power without any support from LEFT . This is a extremelly optimistic news for markets .

For short term, atleast this week , Markets will make some spectacular moves . Monday will be a gap up opening and then after a short consolidation , it can again start its upmove .

It would be wise to go long just after markets open considering gap up is just around 150 point on nifty .

People can buy 3600 Calls , It would be wise to buy In the call money or at the money calls at this point and not out of money calls like 4100 or 4200 Calls , as markets are near expiry.

Go long in Satyam with SL of 41-42 on closing basis

2009-05-16T08:52:00.000-07:00

If we see satyam charts for 3 months , we can see a short term range of 44-50 and we will see that on Friday , Satyam bounced back from support levels of 44 and closed about it with a green candle . This green candle was also accompanied by a DOJI a day before :)

Now today is Saturday and with news of UPA-without-LEFT coming in Power , gives a great signal to go long in this market .

Strategy :

- Go long on satyam with SL of 41-42 on closing basis .
- When It moves up to 50 , Raise SL to Buy price .
- Once It crosses 55 , raise SL to 48 .
- Once it moves above 60 (major resistance point) , add more shares in your long side and Raise SL to Rs 56 .
- Keep shares untill next weakness or your targets are achieved .

See my previous Analysis on Satyam a say before here

Satyam , A quite Storm !!

2009-05-15T12:08:00.000-07:00

I am going to do some Analysis on Satyam this time .

Satyam is ready for some serious move on some side (hopefully upside). If we look at the 6 months chats , we can see that satyam is moving in a very narrow range from last some months , which gives us indication that on breakout , there will be explosive move .

Now , What about other internal things , Is there some serious buying happening ? Are people accumulating the stock ? We will see later . Let us look at volumes and prices once again

Volume : Volumes have dramatically decreased in last 2-3 months . Which gives the hint that lots of people are waiting to get into this stock , once prices show a clear trend . When it breaks out , There is a possibility that there will be heavy volumes .

Price : We have already seen , but lets see once again , the prices have been moving in a narrow range of 40-50 from last many months .
% Deliverable Stock : Now this is the main tool , It is the percentage of stocks which are actually delivered out of total stocks traded . from last many months its rising , which means that The stock is being accumulated by people . There is less speculation happening on this counter .

Conclusion : When a stock moves in a range for long time , it often explodes after that , once a stock is not on the radar of most of the people , its the best thing to buy , Everyone has forgotten Satyam these days , and often it indicates a good opportunity . If you buy this early it can be getting into the bus early , but you have to wait patiently for it to move .

Market view for this week

2009-05-13T10:55:00.000-07:00

Markets are dancing wildly in both the directions and its becoming difficult to trade .Because of election results on 16th May , the uncertainity is very high now and the risk/return can be exceptional .

The best thing one should do now is to wait on sidelines and wait for a good opportunity after the clear trend emerges . Dont think that you are loosing an opportunity , Not having any trade is a great position sometimes . Capital protection should be on your mind at this point .

Tommorrow view

I beleive markets may lower flat and then continue there move on downside . Markets may remain very volatile because of elections . The wise thing would be to paper trade or if you are too stuborn to trade then cut your volumes and trade by 30-40% of your original size .

Markets are showing extreme resistance at 3700 .. so a wise thing would be to short around those levels for intraday , dont carry .

Some Trading Opportunities

2009-04-24T13:34:00.000-07:00

Below is some basic Technical Analysis of 3 shares .

You can take trading calls on your risk , Always use SL , dont take bigger positions than you can afford , Dont be greedy , When SL Hits , just get out without feeling "its coming back again" .

JAI PRAKASH ASSOCIATES : Closed above the channel , But RSI started Falling , so its a wait and watch for some time . Better to buy near 105 if corrects .

SUZLON : Fundamentally there is no news which gives a BUY signal , price has also bounced back from resistance level , Now again approaching towards Resistance line , A short term Trade is possible for a target of 72 , but only after a dip .

SATYAM : Some serious consolidation is going on in this counter and there is no wild activity going on from last some weeks , this is quiteness before the Storm . Breakout or Breakdown will offer wonderful trading opportunity , Dont miss it , wait for it to come patiently .

Risky traders can buy it around 42 , for a target of 60 atleast .

Reliance Break out , target 1800

2009-04-02T04:38:00.000-07:00

Reliance has broken out of its channel and now heading towards target of Rs 1800. Let us see the charts .

I am making this post very late , The closing price for it is around R 1660 now (2nd Apr 09) . It is for sure heading towards its target of 1800 .

It does not mean , you go and buy it next day , that may not provide the best risk/reward . Only buy on dips now . If prices decline and go near Rs 1600 , then you can buy it with strict Stop loss .

If it continues to go further , it would be wise to wait now and rather sell it around Rs 1800 , on signs of weakness . Please see over all market conditions before making the decision .

Strong Resistance at 77-78 for Jaiprakash Associates

2009-03-17T04:16:00.000-07:00

Let us see some Technical Analysis on Jaiprakash Associates today . Looking at daily charts for last 1 yr , We can see an extremely strong Resistance area around 75-80 (77-78 to be precise).

update (Mar 18 , 2009) : Just the next day after posting this article , JAIASS opened higher and moved up and finally closed above the resistance levels of 77-78 , If markets move higher and Jaiass sustains above that level for some days , It can touch 100 .

There are 3 levels for trend lines which are conforming that resistance level . Look at the following chart to see in detail , click to enlarge the chart .

You can see that 3 trend lines at different levels are conforming that point (77-78) as the resistance point .

Long term trend line is very strong trendline and thats the most important one .

Medium term trend line and short term trendlines are also important because they also put some weightage on the long term resistance point . This chart shows the prices Monday , till Mar 16 ,2009 .

Today on Tuesday , Mar 17 , 2009 , markets have corrected a bit after 3-4 up sessions in this bear market rally . and JP Associates as expected changed there direction downwards and closed at 74 after opening at 77 .

How should it be traded now ?

BUY if :

- Global markets are rallying and sentiments continue to be good .
- Prices cross 80 and sustain atleast for 2 days .

Stop Loss : Stop loss should be little below the 77 point , around 75 .

SELL if :

- Global markets rally comes to an end and over all sentiment turns negative .

Stop Loss : SL at max 79 or as per your trading money management rules .

Notes : A lot depends on overall markets sentiments ,be in sync with markets direction . Keep strict Stop loss . Appreciate and expect if markets do something random and do not follow technicals estimates . markets are supreme , not TA .

There is an article on "Should you Invest in Equity Directly" on my blog . Read it if you want .

Markets week , Did you Short ?

2009-03-02T08:39:00.000-08:00

In the last post , I had discussed the trading opportunity of Reliance-RPL merger news. But market direction was negative and one should always expect the unexpected rule , People who jumped into market and traded must have burnt there fingers , because after 15 min of market opening , the trend for market overall and Reliance and RPL was down and they were moving lower .

Today was an important day , as markets were near support point of 2680 and in the last hour of trade , it went below it and finally closed below the support level , which brings further weakness in market .

If you see this 5 day , 30 min charts , Markets have closed below the support levels of 2680. This does not look very good for Bulls now .

US markets are at 11 years low , I have taken a short position through PUTs and also hedged them using a CALL position . If markets go down as expected , i will make some profits , If they bounce back which is very unlikely now , then i will make small losses .

Markets must fall heavily now once it breaches 2500 levels . As I write this US markets have breached the 11 yrs low of 7000 on the news of $61.8 billion quarterly losses by AIG .

If markets open higher on Tuesday , I would like to get out of my call position and then hold the PUTS . If markets open lower , then i would like to wait for small bounce and then get out of my CALLS .

Wait for 10-15 min after markets open for getting true idea of where markets are going .

Manish

Trading Opportunity with Reliance RLP merger

2009-02-28T09:51:00.000-08:00

Reliance RLP merger

Now after this news of Reliance RPL merger , the chances that one can expect a good bounce in these two shares is quite high , especially RPL .

Both the stocks are almost near there monthly support points and we can expect them to bounce back on monday with gap up is quite high and its possible that they break out of there resistance levels , that would be a good indication to go long these stocks .

Lets see both stocks one by one with there 3 months daily chart . click charts to enlarge .
Reliance

If you see the charts there is this upward trend line with support and the stock has actually bounced back a bit from that support point , Though it was in itself a buy signal , now it becomes a more stronger buy signal after this news. So What can be the strategy for this stock to trade .

Strategy :

wait for 15 min on monday , let dust settle and if stock moves up , then go long with SL at 1260 (support line) , better if you can wait for a dip and then buy it .

Dont just jump to go long soon after market opens up , wait for it to settle down , it may happen that it opens too up and then moves down again . Better to wait for 10-15 min first . this is the thing you should always do .

RPL

You can see the support line at Rs 76 , where this stock currently is closed at . After this news , if it opens higher on monday , which has higher chances of happening , go long after 15 min on monday , better to wait for a small dip and then go long . You can also see lower than average volumes for last month when stock was nearing the support , which is also in favour of going long .

Strategy

If stock opens at same levels of 76-80 , go long with SL of Rs 70 (earlier support) .
If stocks open above Rs 80 , you can use SL of Rs 76 (near term support) .

You should not prematurely exit the trade with small profits , better to have 2 targets and book partial profits at first target and hold the another one .

How can we trade this with options (only for people who understand options and have experiance) ?

Reliance and RPL :

Its only advisable for risky traders ,. You can buy at the money call, If stocks do not move in 2 day , get out . If they start moving up , then hold it with SL of buy price and then keep moving your SL after every 10% profit . It depends on your risk profile .

If stocks do not move then there can be chances of big loss , so better to very disciplined with your SL . and use it once trade is not in your favour .

What is the learning ?

The stocks were already near there support levels , and with news like this it becomes a great opportunity to go long on these scrips . But dont forget to see overall market trend and direction , Overall long term market direction is Down and its expected soon , so with some decent profits , get out and dont over carry the position because of Greed .

Trading Opportunity with Jaiprakash Associates

2009-02-20T04:19:00.000-08:00

Let us try to read what Jaiprakash Associates Charts says .

I can see some good trading opportunity with Jaiprakash Associates .

First lets look at long term daily chart for 18 months . Click on the charts to enlarge it .

You can see the it was in downtrend in between and then from last 6 months its moving sideways and its making symmetrical triangle , Its a kind of trading channel which is contracting , which means bulls and bears both are trying hard to win . once its crosses up or down , it will get some direction up or down

You can see clearly how strong is the resistance at upside (see the sliding line at the top , price touch that and reverse , so every time prices approach that area , there will be lots of sellers at the point and you should expect prices to fall again )

. This is the view from high . Let us now take a look from little near , Lets see its 6 moths charts to get a closer look .

You can see two view here , at 6 months level , you can see prices move into a contracting range.

When you see prices for last 1 month , you can see that its moving in a channel like a rectangle , so once it moves out of smaller rectagle , it should speed up the direction and then find support or resistance as the case may be .

What can be the trading strategy for Jaiprakash Associates from this point onwards ?

If you see the price channel , you can see that its 65 - 78 , and the broader channel price is again contracting and is around 60-80 in coming days . So long term and short term ranges are same . So the move below 60 should break it further and prices above 80 should give it strong strength .

So a simple strategy can be :

Buy above 80 with SL of 78
Sell below 61 with SL of 64

Remember : Dont forget for see overall markets directions , Markets sentiments should be in sync with the strategy . Also see volumes , if the breakdown below 60 or breakup above 80 is with below average volumes , be suspect for the moves .

Make sure you put Stops very strictly and follow it once its touched without any emotions and hope . you should respect SL more than your profits , you can go easy with profits , but never with SL .

GOLD Breaks out from its Trading Range

2009-02-17T08:23:00.000-08:00

Update (4:39 Pm , 19/02/2009) : Gold has been moving up and up and made news high with strong volumes , Any dip can be used for fresh buying .

GOLD has been moving into a trading range from Apr 2008 last year . It was moving in range 1140 - 1380 for almost an year . It touched 1380 levels trice . But recently It has broke out from that trading range and currently trading around 1480 levels .

Below is a 2 yrs , weekly chart of GOLD . You can see some indicators which also support the break out like OBV and MACD , Both of them are rising which tells that move is strong . Volumes in Feb are better than Nov , Dec and Jan which again supports the move .

Click on the chart to enlarge .
What are the other factors supporting the GOLD price to upside ?

The biggest thing is that it has moved out of its trading range , The other factor can be that Equity markets are still uncertain in near future (4-5 months) . Bad budget along with bad global clues and coming Elections will also contribute to the uncertainty in Equity markets . GOLD having safe reputation and inverse correlation with Equity will be a small plus point .

What should investors do ?

Anyone who wants to invest in GOLD can invest in GOLD ETF's . Wait for a small dip in GOLD and once it starts rising buy it at that point .A small down move is expected , after which it should again start its up move .

What is the Target price and Stop Loss for GOLD ?

Target : The Target for GOLD can be the Support point + The Height of the Range = 1380 + 240 = 1620 .

Stop Loss : SL should be 10-15 points down from the Support levels .

What if GOLD does not move up ?

What I have shown is simple technical analysis . TA is nothing but analysing something and making an opinion with high probabilities .So it can fail . But there good chances that it will not . If it does , then we have to accept that it was a failed breakout . Analysis was correct but this time markets didn't want us to make some profits ;) . It happens !! . The only thing you have to remember is that the reward from this trade can be much more compared to the amount you are risking .

Understand , we are making a good trade . It can be loosing one . Making a non-profitable trade is perfectly fine in long run , if it was properly studied .

Some Lessons and Learnings

What Does Breakout Mean ?

Break out means coming out of the trading Range on the upside . When it breaks from downside , its called Break down , In any case , further movement should be expected . Read it here

What are OBV and MACD ?

They are indicators which gives some indications and confirmations about the movement . Once breakout happens , we confirm the movement with Indicators . Read more about OBV and MACD on your own , thanks :)

Disclaimer : I hold 10 units of GOLD ETF's bought around 1220 levels from last 9-10 months .

RELIANCE in a Trading Range

2009-02-05T05:45:00.000-08:00

I am discussing here a simple Technical Analysis example . Here we will see opportunity for buying or selling in Reliance .

For last 3-4 months reliance is Trading in a range , This range is getting contracted day by day , We try to make a trading range Area for it , buy joining two consecutive Highs and And lows . You can see that this line at up and bottom is acting as support and resistance levels for Reliance .

Click Image to Enlarge ...

You can see the live chart here

Once Reliance breaks up or down of this Channel it will take a direction . If reliance Breaks up of this Channel , then its a Buy signal , If it breaks down this channel then its a SELL signal . Inside this , Better not to trade for a long move .

Understand that what ever i talked should not be taken as a word on stone , But probability wise , we have better chances .

At the bottom you can see Two indicators RSI and SLOW Stocastics . If someone want to trade Reliance for short period , He can sell RELIANCE once Blue line crosses Red line in down direction for the second indicator . That will signal that Buyers have taken control over sellers .

This is a simple analysis of a stock using Technical Analysis . Understand that Technical Analysis gives you some idea about what can happen , Its not the confirmation ever . You should always be ready to be proved wrong and use proper Stop loss placed and ready to take losses once your are proven wrong.

Investing in RPL in FEB 2009

2009-02-03T01:16:00.000-08:00

Ronak asks :

I am planning to invest around 1-2 Lakh Rs to buy RPL shares. At the current rate @83, do you think I should go ahead and buy some shares? like 500-700? or should I wait for sometime to lower the rate?

My Ans :

Hi Ronak

By seeing the charts i can see that its in a trading range of 70-93 , 70 is the support level . and 95 is a resistance level . see its 1 year chart

The price is below its 50 Day moving average , so it is still in downtrend .

Long term low of this share is around 65 , so looks like its very difficult to fall below this .

With markets still unpredictable in short-medium term , the share is expected to dance in this same range of 70-95 .

So the best idea would be to buy it either at support level prices of 70-75 , or after it breaks up from 100 levels . the best thing i would suggest it to invest your 25% money near 70-75 levels .

I hope you got what your wanted . Better we discuss things like this on a mail or i would run a separate blog for this kind of analysis . Understand that the small analysis i gave you is purely technical and not fundamental . it is only indicative and probable .

Learnings

Before investing in a share , looks for its resitance and supports levels (Read about Support and Resistance) and its range , Seeing this small thing can help you to make better investments.

Manish