Important Observation In NIFTY

Fresh weakness only below 5980 Levels.

Expect Strong UP above 6050 levels.

Yet Non-decicive trend continues.  

On the other hand trading above 6050 should emerge strong buying.  

LOW VOLUME MOVEMENT MAY GIVE UNEXPECTED FLUCTUATION.

Another day passed without much gain or loss and NIFTY continues to trade in the NRB move (Narrow Range Bar)

Yesterday we have observed a pattern called Harami White and then today (i.e. on last trading day no signal or confirmation.

(HOWEVER I HAVE FOLLOWING OBSERVATION FROM INTRA DAY TIME FRAME GIVEN IN NEXT PAGE NO 2)

After so many days we have observed some momentum in cash segment as well as in other oil stock. Something is cooking up and as we have passed so many range trade and hence the unidirectional move is very near and in next 48 hours should give either directional breakout.

Close above 6015 or trading above 6080 will give strong up move in the upward direction while trading below 5980 should trigger fresh selling signal.

Behavior of NIFTY from last swing low 5721. It is observed that it has a tendency to correct its previous swing by 0.50% to 0.618% and If this is the case then yesterday NIFTY corrected its last swing by 0.618% when NIFTY SPOT registered 5982 (0.618% is at 5980).

Considering the past attitude we can say that now NIFTY should not go below 5980 in any case. Even after violating 5980 same day recovers and starts trading above 5980 it will be a clear buy signal. So now without violating 5980 if 6050 is surpassed then next probable peak at 6127 area.

Swing Type	Bottom	Top	Net Gain	% Gain	Probable TGT
Swing I	5721.15	5887.65	166.5	2.910254
Swing II	5804.1	5953.95	149.85	2.581796
Swing III	5855.05	6023.8	168.75	2.882127
Swing IV	5940.36	6045.75	105.39	1.774135
Average Gain From Low			147.63	2.54
Expected Swing	5980 + 147.63 OR 2.54%	????	147.63	2.54	5980 + 147.63 =        6127.62



… Markets are constantly changing.  As a trader, you need a strong foundation to weather the storm.  Over the last few years, as traders, we have had to weather a devastating storm. 

NIFTY after completes 0.618% retracement, market is now not giving clear direction.

From the above chart a small thing is emerging on the first look. The EMA which is placed on the chart is turned red and moving downward since last 15 days and the force is turned down. From last three days it is trying to come out but failed to do so. On the other hand ADX (lower window) is in bearish mode (since red -D line is above green +D line indicates that though market is trying to show some strength or rally but in fact smart money or buyers are not there unless +D moves above –D. So short term immediate trend is bearish or weak and unless this both indicator turns green rally will be difficult to sustain.

·          The Relative strength of the small cap index and CNX midcap v/s Sensex have formed an H & S near a triple top range. Each time the RS has fallen from the upper end of the range it was followed by 1 year of under performance by small cap stocks. So expect a clear shift in leadership to large caps.

·     The Bottom Line: one more day nifty ended with clueless and turned without any clear picture. However, 5924 and 5884 are more important for the next couple of days.  On the other hand sector wise panic is going more weak like Bank sector weak with -5.17% during the ongoing week. While small cap continues to be under pressure with PSU and MIDCAP WITH -1.41% and hence some strong unwinding can be expected in the coming days. After this panic I expect change in trend.

On the other hand surpassing of 6005 and then 6080 will give strong upward thrust. While, metal is coming out from its corrective/bearish phase. Due to rise in international oil price oil sector is gaining strength. Even software stock is showing strength due to strengthen of dollar.

On technical front NIFTY is trading below its EMA which is turned red and direction is also down hence we can say that the short term is weak  

Teaching and Learning

Teaching is the greatest act of optimism. --Colleen Wilcox

 Good News of the Day:

In today's era of high technology and endless information, in a culture where cell phones, computers and the internet seem to infuse every corners of our lives, "79 percent of the people on our planet digitally are excluded," reveals Ashoka Fellow Rodrigo Baggio. Armed with the vision to empower low-income youth with computer skills, Baggio founded CDI: The Center for Digital Inclusion. Starting from one of the most dangerous, poverty-stricken communities of Brazil, Baggio and his team have spearheaded a technological and cultural transformation across 13 countries. Teens who were once headed for gangs and drugs have found new outlets for their energies: making videos about social issues. "I never thought I had a future in front of me," says Wanderson da Silva Skrock who, at fourteen, was dealing drugs. "I believe you can rescue someone, even from the very bottom," the now CDI teacher states.

Be The Change:

Offer to teach a skill to someone. You never know where the ripples might go

Nifty heading for 5334 to 5304 levels. Level 5495 is SL for short

When NIFTY close marginally positive at that time only it was clear that market will be in trouble for next trading day. Because it made a minor sub-wave in short term time frame. Also closed consecutively 3rd day below its medium term EMA and also weekly EMA is penitrated in downward direction.

Using Fibonacci ratio of the last up move (this may vary from person to person as calcuating from which level is and individual thought) from 5210 low and 5549.80 high it gives 5420 (0.382), 5379 (0.50), 5339 (0.618) and 5304 (0.722). Out of this probable four level 2 of them already reached and NIFTY is trading below its first two levels. Now what?
> It has confirmed that at 5549 top is formed. 
> After four days sharp decline a marginal advance observed was nothing but a puase status. 
> Now Nifty is trading below its short term important 25d EMA for secod consecutive day. 
> PSR turned -ve and lastly advance decline ratio also turned -ve. 
Conclusion: Considering all the above fact i personaly arrive to conclustion though long term is very very good but for short term market is vulnerable to down and is expected to correct its last entire up move. 
Strategy:  As suggested earliear either stay short or sell on intra day rally. Your SL of 5495 for swing trader and 5459 for intra day trader. Market will have to surpass 5488-5505 in sigle strong with rise in volume to re-enter in up trend.

FRESH WEAK STOCK:

BOB: 801.25. SELL WITH SL OF 817. EMA IS AT 813. IMMEDIATE TGT 789 OR 778.

GOD IND: 201.70 SELL WITH SL OF 206. EMA IS AT 207.50. IMMEDIATE TGT 197 AND LOWER.

LT: 1818.75 SELL WITH SL OF 1852. EMA IS AT 1847 AND TURNED DOWN. IMMEDIATE TGT 1797 TO 1776 LEVEL.

SIEMENS: 699.20: SELL WITH SL OF 716. EMA IS AT 714. PROBABLE TGT 686 AND 674 LEVELS. 

PROBABLE WEAKNESS EXPECTED IN: 


ICICIC BANK: 967.90: Stock is entering in a weakness/corretive decline. More weakness will appear on surface below 948 levels. Avoid long and sell short below 958 levels. Daily ema is turned weak and breched in bearish mode while weekly is likely to test at 935 area.

SBI: CMP 2800. Eexpect a weakness below 2770. At present difficult to sustain above 2820 levels.

SOME RAY OF LIGHT IN DESERT:

TATA STEEL: 527.90. Stock turned strong and +ve on last trading day. It has a potential to move up to Rs 560 to 580 levels. CLose above its EMA 520 in daily range and 517 in weekly range. Close above high of the lowest weak indicating swing reversal formation. Both daily and weekly charts are good. Minor hurdle is present at 538 area where partial profit booking is advisable.

Other stock which looks good to me are Bharti, Biocon, Dish TV, REC and Powergrid.


Written at and completed 31/08/2010


Technical Analyst, Adviser to Real Big Time Position Trader in stocks, transmitted 31/08/2010 8:12:50 AM

Above views and ideas are sollely for me and for friends for reference only and not as a trading opportunity or recommandation.
Freelance writer: Bluchip Gujarati Weekly, Divya Bhaskar on Sunday, for stocks, Precious Metal and Currency Trading


Abbreviation DTL: Downward Trend Line, TSO Trailing Stop Order for intra day price RL remain long CMP


CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES IMILAR TO THOSE SHOWN..

High Volatility Expected. Good only above 5495 levels.

“Investment is like a stair case, trading is like a lift, lift may fail, but stair case is sure to take you to top."

Hello All,

I hope everyone had a great weekend.

Did you know that emotion plays a huge part in your success with trading?


That's because when it comes to trading live, and pulling the trigger, so many of us just don't have the confidence and trust in what we're doing.


That is a big problem!
Maybe it's because you're new and feel you simply don't know enough to make all the right decisions.
Maybe it's because you haven't been consistent and you are struggling to get there. Whatever the cause...
We then become that 'Roller Coaster' trader who is struggling to just break even.
I don't know about you, but I don't trade to just break even.
Watch some of the easiest trading here:
It's time to get off the roller coaster...

Today is a DHRUVE DAY.

NIFTY remain in a NRB for at least 8 week with a range between 100 to 140 in weekly time. During this time it was getting resisted near its upper resistance area of channel. Now this channel has acted as strong resistance during last week and on Friday a clear “exit long signal” observed. After the market hours US market was very strong and Dow closed firm with 164 points gain. (infect 10300 is its major and important level. Unless it close and mange to sustain above that we cannot have faith in rally). Here at domestic front NIFTY is difficult to cross 5555 while on intraday level 5495 and 5520 are strong resistance for intraday player.

Nifty DOHLC with Swing, D Channel, EMA and ADX

NIFTY/SENSEX failed to break above the CHANNEL resistance of 5550/18634 and infact made a WEEKLY DOUBLE TOP with reversal formation on last week.

1. The drop in domestic markets was led by the REALTY stocks.


2. For the week, NIFTY/SENSEX has multiple supports placed near 5350/17838 level. If NIFTY/SENSEX breaches the said support, a year‐long consolidation phase would resurface and the next support would be found at 5187/17296 zone. In the event NIFTY/SENSEX manages to take out the resistance level of 5555/18454, the fresh upward move will began of the index towards the targeted level of the January 2008 gap. However position of daily and weekly OBOS oscillator indicates it is very difficult to sustain rally at higher level. Before making a fresh strong up move we need one breakdown in which almost all the novice long holder will exit from long. Market is not ready to take them in upward move.


3. Stock of OIL pack is looking very strong and one can have in their position portfolio or investment portfolio. They are expected to outperform. On the other hand Metal index which made a high at 18736 followed by lower top at 15930 3 week before and now turning more weak needs to be closely watch.


As SGX nifty is trading +50 points above but I consider 5495 as important resistance. Unless this resistance is crossed rally is difficult to sustain. Also today is a DHRUVE day hence need to be closely watch and trading below open will have a tough time for long trade.


Stock which are good for short term buy are EID parry, Gail, Jind Drill and Shlakshmi.


KNOWLEDGE IS POWER.


SWING TRADERS


Fast becoming the trading style of choice, swing trading offers the greatest opportunities. The markets have changed and big moves no longer take weeks or months. Ten-point moves are quite possible in two to six-day periods. Adapting to this style of trading allows a trader to reap huge gains quickly, because he does not allow volatility to eat away his profits in longer-term positions. This is just simply smart!


Swing traders usually hold onto positions over a period of two to six days, trying to pull out a minimum of one to three points. Targets can be three points and higher. The swing trader has the option of adding to his position if his entry point is not quite exact, as long as the stock does not go beyond its predetermined stop-loss.


The swing trader usually trades stable $20 to $50-priced stocks in well-established companies that have the potential for three-plus point moves. Because of the reputation of the companies, a twenty-point gap the following morning should be low risk but still possible. Swing traders with less experience should use smaller-share lots than the 300 to 600 a swing trader normally uses. Some swing traders will use a starting position size of 100 to 200 shares to get a hands-on feel about how their stock is behaving before adding any size to their holdings.


Swing traders focus on daily charts, although they may use weekly charts to see the bigger picture and help with choosing market direction. They also use sixty, thirty, fifteen, ten, and five-minute charts. Swing traders gain advance knowledge and technical analysis by focusing on Japanese candlesticks, moving averages, volume and stochastic studies, as well as candlestick patterns and support and resistant areas.


The swing trader is a true professional with knowledge in many areas, including market psychology and market sentiment.


TOO MUCH TIME TRADING


Now that you know it is sometimes wise to stay on the sidelines, you should only trade high risk-reward ratio plays, and you must always use a stop-loss, let’s move on our next topic: spending too much time staring at Level 2 screens, examining charts, and trading.


Are you constantly trading after the closing bell and pre-market? Some traders dedicate all of their time to reading fundamentals, checking the news, and looking at charts. Every trader needs to do these things, but you must allocate a small portion of your time to these matters, not all your time.


You should try to avoid listening to the media, especially the analysts who lie, and you must try to ignore stock tips from your local banker. All of these different opinions can cloud your better judgment. Many traders become frustrated because they work so hard and still lose money. Some work 18 hours a day or more, trading during lunch, watching CNBC while eating dinner, asking everybody for stock tips, etc. This is a common mistake by beginning traders. They do not focus their time on doing the things that will help improve their trading.


Traders should be printing out charts of the stocks they traded that day, labeling the entry and exit points, and documenting their reasons for entry and exit. By doing this, a trader can find out what his common mistakes are as well as his strong points. By reviewing these notes on the chart, the trader can clearly see if he is getting a bad entry, getting shaken out of position, taking a stop-loss of 2 cents only to see that he was actually right after-the-fact, or, more commonly, taking profits way to early.


Traders must discover their worst habits and spend their time correcting them. They should also calculate their commissions at the end of every day, including SEC fees, pass-through fees, and any other charges. This gives the trader time to reflect on the cost he is actually incurring when he gets into low risk-reward ratio positions and makes him think twice about doing it again. Every trader should devote more time to reviewing and correcting errors instead of spending their time actually trading.




.

Short Term Time Frame Vulnerable: 5450 to watch.

NIFTY: 5417: In the last eight week NIfty traded surprisingly in a NRB range between 100 pints to 130 points.


On first day of the week NIFTY traded weak with red candle and closed weak. This is interesting to note that in last 8 week NIFTY consistently seeking support at 5350 levels. Now will it break? is the million $ question to answer. Nifty required to close above 5513 to regain its bulls strength till such time rally may be observed but of no use. On the other hand violation of 5450 will be a danger signal for the bulls who are holding long position in a weak stock they may be battered more for a new low.

NIFTY NSE CASH WITH OHLC AND ADX, EMA, D CHANNEL

Now look at various stocks which are showing clear weakness and progressing in a weekly downward trend. Almost 50 companies are trading below their weekly EMA and not only that its direction is also turned down. In other words the trend is down in the following stock and any kind of rally observed can not be sustained unless it trades above the EMA lvl at least for a couple of days.

Aban, ABB, ABGSHIP, BEL, BRFL, CHENNPETRO, CIPLA, GOLPAL, CONCOR, COREPROJECT, DR REDDY, EDUCOM, EKC, ESSAR OIL, FSL, GLAXO, GTL, GTOFFSHORE, HCC, HEXAWARE, ICSA. INFOSYS, IVRCLINFRA, JPPOWER, M&M, MARUTI, MTNL, NAG CONSTR, NAT ALUM OFSS, PATEL ENG, POLARIS, PUNJLLOYD, RCOM, RELIANCE, RELINFRA, RELMEDIA, RNRL, ROLTA, RPOWER, SAIL, SESAGOA, STER, SUZLON, TATA POWER, TATA STEEL, TECHM, VOLATS, WIPRO, ZEEL.

On the other hand around 12 stocks are rendering buy signal and closed above their respective weekly EMA looks good to buy and hold.

ABIRLAUNO, ASHOKLEY, BHART AIRTEL, DIVIS, GTLINFRA, JINDALSWHL, JISLJALEQS, LUPOIN, MPHASIS, NTPC, SIEMENS, TATA GLOBAL.

The stock which i like to trade long are APIL, JINDALSTEL, OFSS, POWERGRID, NTPC, (This stock are coming out from their oversold area and rendering short term buy signal).

NTPC: Rs 198.65. Look at the following DHLC chart of NTPC. It was in a downward trend from 238 high. After March 2010 it started taking support around Rs 194. During last 6 month stock was getting strong buying support around Rs 190-194 area. During this time stock made an important swing high at Rs 212 followed by lower top 206.

NTPC Daily OHLC Bar with ADX, EMA and SWIG.

Why i like this stock is due to following reason:

Firstly ADX line which surpassed its bearish zone in the oversold area only is a +ve factor.
Secondly stock moved up on last trading day with remarkably high volume indicates a fresh entry of bulls.
Thirdly price close above its EMA level and today if sustained above 196 then EMA color will change from RED to GREEN will be a confirmation to short term up trend.
Forth argument is that stock managed to surpass its last week high 197.75 with ease and close above that indicating it has tried to come out from the bearish grip.
How much gain possible. Looking at the size of accumulation since MARCH to till date immediate TGT or resistance would be Rs 206. Upon surpassing the same using Fibonacci ratio i come to the conclusion that it can move to 214 to 219 area. I consider this as a potential safe buy with a risk level of Rs 4 and gain of Rs 16 so it is not a bed trade where R/R ratio is 1:4.

Friends and followers this is what i feel as per the pure technical chart.

Basic of Technical Analysis: Vital Information in Your Trading

Recently a party in which I had a conversation with a retired physician. An astute and very successful long-term stock investor for decades now, he had recently read one of my columns. This gentleman has been very successful with individual stocks for many years, basing his trades on fundamental decisions.

This started the wheels turning in my head. There are many successful investors out there who have never even heard of technical analysis, let alone utilized it in their trading decisions.

BACKGROUND
The subject of technical analysis has been around for hundreds of years and various theory such as Japanese candlestick charting techniques is one of the oldest forms of technical analysis and evolved from methods utilized by 18th century rice traders, it is only been in recent decades that mainstream active traders have begun to study and implement the methodologies.

Many point to the day trading tech stock boom of the 1990s and the advent of the Internet and the personal computer as key factors, which opened the floodgates on this method of market analysis.

Looking back, in the 1960s and 1970s technical analysis was considered as reliable as tea leaves and the major Wall Street firms downplayed their reliance on that form of market analysis.

Technical analysts were virtually hidden in back research rooms. Some of the top technicians on Dallal Street today have shared stories with me about how their firms, at that time, would rely on their analysis and recommendations, but present the ideas to clients under the guise of some fundamental factors.

SOME HISTORY
However, technical analysis has been practiced in the United States since the late 1880s, and in India since 1965, well before fundamental analysis took hold as a mainstream discipline. During those times, income statements and balance sheets were not as readily available as they are today. But, price, the foundation for technical analysis, was always available.

Remember tape reading? A famous dancer Nicholas Darvas?, then W. D. GANN? Early technicians were simply tape readers, or those who watched prices go up and down on the tape to identify support and resistance levels, points where demand and supply stall movement. Point and figure charting can be traced back to the 1880s, while it wasn't until the 1930s that fundamental analysis emerged as a market discipline.

What's the Premise Here?
For those who have spent their investing careers studying price/earnings ratios, quarterly profit reports, new product launches and management teams, technical analysis actually offers a respite from this type of study.

Technical traders and investors note that it is virtually impossible for an individual or even a research team to identify and understand every fundamental supply and demand factor in the marketplace.


Everything reflects in price.
Price, both current price and historical price, encapsulates it all. That is where the market adage arises from: "It's all in the charts." The philosophy is that the current price of a stock, a commodity future, a foreign exchange rate, represents the immediate opinion within the marketplace of all players. In other words, all currently "known" fundamental information is priced into the current level of the financial instrument.


Key Principals
Technical analysis, very simply put, is the study of price and the history of price in an attempt to gauge current and future trends. The three underlying principles that drive technical theory are:

• All news is discounted in price.
• Price moves in a trend (sideways, up or down).
• History tends to repeat itself.

A Good Read
I'm reminded of a quote from a very popular trading lore book: Reminiscences of a Stock Operator by Edwin Lefevre: "The principles of successful stock speculation are based on the supposition that people will continue in the future to make the mistakes that they have made in the past." The demons of fear, greed and the herd mentality create some pretty interesting patterns on the charts.

Fear and Greed
Market bottoms tend to form during extreme periods of investor and trader fear, while market tops tend to develop amid times of extreme greed. Tops are created amid buying excesses. I don't need to remind investors of the bubble-top that burst so dramatically in the NIFTY in January 2008.

Many portfolios and retirement accounts were painfully decimated during the tech stock collapse. Human psychology really hasn't changed that much over the centuries. Markets move from greed at the top to fear at a bottom. Looking at a daily, weekly or monthly price chart may help remove some of the emotional factors, which are the culprit of so many trading and investing mistakes.

Try to talk with Pictures
Pattern recognition, simply a visual read of a chart looking for specific formations can offer important insights to traders and investors. Patterns and formations, which repeat throughout markets, and throughout timeframes can offer traders and investors on clues on better entry and exit points.

Technical Analysis Useful For Investors Too
For my retired physician friend, I have but one suggestion. Keep doing what you've been doing. You've been very successful at it. But, while technical analysis is generally the methodology of choice for intraday traders or even swing traders, it can be helpful for longer-term traders as well. How?

Long-term players generally rely on fundamental factors to initiate their positions. Fine. But, technical analysis can help one determine more profitable entry and exit points. I believe everyone who is investing or trading should become comfortable with looking at charts.


The starting point is trend. While many folks think in terms of either a bull or bear market there are actually three types of trend: an uptrend, a downtrend and a sideways or neutral trend, also called a consolidation move.

The simple definition of an uptrend is a series of higher highs and higher lows on whatever timeframe chart you are monitoring. The concept of trend is the foundation for many old market sayings, such as "the trend is your friend," or "don't buck the trend."

Find Pullbacks and Support Zones
If a long-term trader identifies a company they want to own. Take a look at a chart. It all goes down to the simple concept of buy low and sell high.

Markets don't move in straight lines. They consolidate they move up, they pull back and correct. They plummet occasionally on bad news and score a spike low before bargain hunters swoop in and push the stock price quickly back up to previous levels. The long-term investor doesn't want to pay up for his or her stock. No one wants to pay up for anything. It all comes down to timing and technical analysis can help you pinpoint more profitable entry zones.

Multiple Timeframes
It's worth looking at action on the chart on a monthly, weekly and daily timeframe before entering that buy order.

If the market is trending higher, connect the dots (the lower peaks on pullbacks): that is a trendline. When stocks are "correcting" or pulling back to a support trendline that can be a good spot to buy. Or has a stock been consolidating between readily identifiable support and resistance zones for months, say between Rs100 and Rs125?

If an investor wants to buy for the long-term, look for retreats to the bottom of a sideways consolidation zone near Rs100 for buying spots. You've heard the adage: add to your winners. Investors can play the breakout. Once the stock breaks out through the resistance level at Rs 125 that could be a good time to add to your position as you are likely to catch a new upswing in a bull trend.

Taking Profits
Technical analysis also offers clear upside targets and price objectives. While the long-term buy and hold investor may not want or need to exit a trade. If there is a specific reason that one wants to take some full or partial profits and trim long exposure, technical analysis can help identify realistic price targets, which could signal the end of a trending move.

Going back to the simplistic example of the stock consolidating between Rs100 and Rs125. Months of sideways zig-zag trade occurs, with an upside breakout above Rs125. Investors can calculate a so-called "measured move" objective. Simply take the width of the consolidation zone (in this example: Rs25) and add it onto the breakout point (Rs125 + Rs25), which equals an upside price objective or target at Rs150. That price target can be a good spot to take profits, if one so desires.

Getting Started
Have I at least whetted your appetite to learn a bit more? There's no reason to spend a lot of money on seminars or software packages, there are a couple of important and basic books that can help an individual gain a basic introduction to the principles and concepts of technical analysis.

It's as easy as a visit to your local library. Two classics that I'd recommend as starting points are: Technical Analysis of Stock Trends by Robert Edwards and John Magee. Another comprehensive must-have title is Technical Analysis of the Financial Market by John Murphy. Have fun.

Deepak Shah - Saudagar

More Correction Likely. Strong support at 5430

NIFTY D- OHLC WITH EMA AND ST%

Look at the above chart in which we have observed rising channel and on last trading day NIFTY closed exactly near the support area/lower part of the channel. As STK% is also moving away from overbought area and pointing towards downward direction. Also Nifty closed near the short term EMA rainbow which is likely to give support.

On the other hand it is trading below important weekly critical lvl of 5510 while lower support lvl is at 5395. In any case NIFTY should not go below 5395 lvl.

DERIVATIVE SEGMENT: Top 5 gainers are Nat ALU 4.92%, Idea 2.51%, OBC 2.17%, Patni 1.97% and Andhra Bank 1.38% On the other hand>>>>>
Top 5 looser are IBREALEST -4.25%, ABIRLANUVO -4.17%, PTC -3.95%, NAG CONST -3.93% and CH FERTI -3.84%.

World Market:

Dow is already weak in Daily range and now it is turned weak in weekly range also. Probable TGT is placed at 8500 lvl.

FTSE is also progressing in short term downward trend. Important and major resistance is at 5280 lvl. 

Hang Seng is progressing in short term downward trend while 21200 is major resistance lvl. Below 20500 its medium term trend also will turn weak.  

S&P 500 is very much eager or desperate to meet its previoius important low 1010 lvl. Might go even below that.

STOCK MARKET:  Out of 191 derivative list 15 stocks are showing reversal. Out of this 15 stock 14 are in rendering SELL signal while only 1 stock IDEA is +ve.

BANK NIFTY: 10947. I have observed uninterrupted uptrend from 9276 low is now topped out at 11110.95 lvl. According to me it has a support at 108880 and which is most important support. I will prefer to SELL short only and only below 10880 lvl. However i know its basic trend is up only. Will prefer to protect long with above SL. Some correction expecting.

BHEL: 2464: WEAK STOCK: The trend of BHEL seems to be weakening and further weakness i can not ruled out. The chart pattern indicates that more price damage expected when close below 2460 lvl. Trading SHORT at CMP can be a good idea yes with a strict and proper SL of Rs 2500. Probable TGT is 2390.

BPCL: 752.45. Some tiredness is observed as i have seen a non stop run from 621 low. (this is a clear signal that stock is entered in PAUSE status and "do not consider a SELL call" its critical lvl is 700 and hence unless this lvl is breached it is an up trend stock.

IDEA: 70.95. Stock is trying to enter in up trend. Buy some initial qty at CMP with SL of 68.30 as critical level (this is the lvl below which stock is weak and above that stock is strong). Add more long to your position when close above 72 is observed. Considering EMA and position of STK for short term as well as medium term looks promising. Any way I will prefer to be long with SL of 68.30.

TATA CHEM: 395: POSSIBLE weakening of Trend: Short term down. Prefer to SELL with SL of 405 with expectation of Rs 375 TGT. Its a 1:1 or 1:2 profitable trade.

TATAMOTOR: 992.10: An up move started from 748 lvl continued till 1058 peak is reached. From last 5 days stock is showing weakness. It is now trading below critical level 1020 and hence considered as weak. Also weekly reversal observed as previous week's low 992 is breached. A minimum TGT of 940 (0.382 of pr up move) is expected. Off course its a speculative calculation hence keeping of SL at 1020 is must.


Discllaimer:
Technical Analyst, Adviser to Real Big Time Position Trader in stocks, transmitted 26/08/2010 5:36:59 AM
Freelance writer: Bluchip Gujarati Weekly, Divya Bhaskar on Sunday, for stocks, Precious Metal and Currency Trading

Abbreviation DTL: Downward Trend Line, TSO Trailing Stop Order for intra day price RL remain long CMP: Current market price Note: Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints. Nothing in this article is, or should be construed as, investment advice. Commodity, Stock, Metal Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is 6


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Todays Market 24th August

NIFTY DAILY HIGH LOW BAR CHART

Commentary: Look at the above chart. It is a daily HLC bar chart. Along with EMA and OBOS oscillator in the lower window. (not shown and will be updated shortly)

• On the high low bar chart a rising channel formation is emerged which is likely to act as strong resistance level.

• On the other hand in lower window OBOS oscillator also entered in to OB area with value placed at 93.40.

• Since EMA setup is in strong upward mode I can say that up trend will continue but because of expiry, resistance area of rising channel and OB status of oscillator when combined it clearly indicates that some sudden correction of 50 to 150 points can not be ruled out.

• No doubt this may be of temporary in nature but it is certain that correction is expected.

• Simultaneously I am expecting stock specific movement to continue and turn by turn stock will take its turn to show strength.

• The only question for you is to enter and take position in time so that other makes money or not but you (ie. My readers and follower should make money.



 It has a strong resistance of rising channel at 5580 area. Also upper boundary of channel is at 5537.

 As per latest up move in the form of Elliott it is progressing in 3rd wave of 5the larger degree (count for 5th wave is expected at 6165. In other words ultimately we have to reach up to above levels).

 Due to weak US market domestic market may open weak but it will have to breach 5480 level to reverse the traders mood.

 Remember to change entire up trend in to weak trend NIFTY has to trade below 5350 level. Unless this happens TEJI is intact.

 Do remember that we are entering in short term very high area. So violent fluctuation with wide swing is expected. This will be danger for intra-day trader.



CRITICAL LEVEL 5530

TODAY’S PIVOT LEVELS: R1-5548, R2-5559, S1-5520, S2 5503.

EMA POSITION: 5516 5489 (5/6)

 Areval T&D: 303.55: Buy current or next month future: SL 295. TGT 318 to 322 immediate and the it may move to new zone.


 Ispat Ind: Rs 19.40: Stock entered in uptrend after a long time. Stock is having very strong support at Rs 18. Buy on decline near Rs 18.50 or lower. Look for the price of Rs 22.40.

 Polaris: Rs 179.05. It was passing through a correction and recently it made a low at Rs 169.70. yesterday first time it closed above EMA with rise in volume and +ve divergence in oscillator indicates more upside cannot be ruled out. Buy with SL of Rs 174 and look for the TGT of 188 to 190.

 ABIRLANUVO: Rs 836.20: Stock was moving in a side way and number of +ve divergence observed during last 5 days of working. At last yesterday this stock penetrated its EMA giving bullish crossover signal. Now +ve divergence coupled with high volume and surpassing of its swing high all indicates that a strong up thrust is imminent. In spite of expiry this stock is likely to outperform and hence we can say that it is a best buy for intraday as well as position. Buy with SL of 810 for the TGT of 865, 892 or 908.

 MPHASIS: Rs 607.15: On chart at first look we can not identify any kind of bullish pattern on this stock. Yes but due to highly oversold situation in OBOS indicator and emergence of bullish crossover of EMA indicates some unusual upward move is likely to unfold. Just buy at CMP with SL of 595. You can have probable immediate TGT of 624 to 629 and if you can ride on EMA signal then let this signal to render sell signal till that time ride.

 INVESTMENT: IN THE CASH SEGMENT I LOVE FOLLOWING STOCK TO INVEST:

 Horizon info: Rs 272. Stock entered in uptrend after moving in consolidation phase for long time. Buy and hold for TGT of Rs 300+ in short term.

 Rico Auto: Rs 30.35: One of the strongest bullish patter on weekly chart and this stock is likely to outperform in the coming days. Must have in your portfolio of short term to medium term time frame.

 EMMBI: Rs 18.10: Stock moved up from Rs 13.30 low to 20.25 high in just 5 weeks time and now stock consumed much more time in correction but correction observed in time cycle and not in price front. This is a clear indication that some smarty is active at lower lvl to give support. One can buy for medium term. Do not consider immediate gain as it may consume some more time. But return wise I expect a price range between Rs 25 to Rs 30 in 3 months so it is not a bed deal considering interest part.

 TTK Health: Rs 415.15: Stock moved up smartly in last trading and closed near its important resistance lvl as well as previous high. Direction, force and slop of EMA indicates that stock is now entered in momentum. Must have in your portfolio for medium to long term. Even it would be a good short term play. Buy for TGT of Rs 460+ .

 Valecha Eng: Rs 194.40: Again like above stocks this is having a very strong pattern on weekly chart. Likely to move against general market condition. Buy and hold for TGT of Rs 220+. Close above Rs 207 will give strong upward momentum.

 TATA Sponge: Rs 330: Must must and must buy for portfolio. It has a potential to move up to Rs 370+. A gain of 30% in 3-4 months expected. Buy and hold.