I can help you with stock chart reading

[rahulg77]

Hello VV,

What are views on Jai Prakash Associates. After touching all time high of 600 it started its pull back. At the all time high we can see a Doji, followed by a shooting star and then a dark cloud cover. then the pull back started. It just tested its 50 day MA at 500 level. 500-510 is also a resistance area in the month of april and earlier it proved to be a resistance area around first week of march.

It also tested the trend line which connects near the periods- 25 jan 2006, 22 feb, 29 march, 13 april and 12 may 2006.

In the weekly charts it is in a very nice uptrend and a 8 day MA is moving like its trend line.


You think this might be a good entry point with a stop at 500. I am relatively new to TA so please excuse me as I do not see the entire picture as some of you seniors here. Those are my views and would appreciate if you add to it and tell me how would you trade this script or maybe ignore the script too. If ignore what would the reasons be.

Rgds

Rahul

 

[rahulg77]

Hi VV,

another one. I want to understand how to make an entry. I know it would be a very wide subject. For eg if someone tells me to buy stone india-522085 and fedder llyod -500139( i am already into these stocks at lower levels) but for assumption purpose i get a tip and i want to study the TA aspect to be sure about investing at todays level. What would u look at and how would u time your entry.

Rgds

Rahul

 

[vvonteru]

Hello VV,

What are views on Jai Prakash Associates. After touching all time high of 600 it started its pull back. At the all time high we can see a Doji, followed by a shooting star and then a dark cloud cover. then the pull back started. It just tested its 50 day MA at 500 level. 500-510 is also a resistance area in the month of april and earlier it proved to be a resistance area around first week of march.

It also tested the trend line which connects near the periods- 25 jan 2006, 22 feb, 29 march, 13 april and 12 may 2006.

In the weekly charts it is in a very nice uptrend and a 8 day MA is moving like its trend line.


You think this might be a good entry point with a stop at 500. I am relatively new to TA so please excuse me as I do not see the entire picture as some of you seniors here. Those are my views and would appreciate if you add to it and tell me how would you trade this script or maybe ignore the script too. If ignore what would the reasons be.

Rgds

Rahul

---Agree with Ur analysis. See attached chart. Have a stop with at least Buy Point - 40. Buy Point - 80 is better. However, if it goes below Rs 500 (at least 2 ticks), U should not buy it. If it goes below 500 after U buy it, get out. At that point, existing trend is no more there. I sincerely doubt, it would do that. Current pattern is exploding triangle.


BILT is Ballarpur Industries and its NSE code is BILT.
---This goes in a channel. The low end of the channel is the 50 day ema. When it touches 50 day ema, buy it. Upper end of the channel is the upper bollinger band. If U choose, U should sell it over here.

 

[vvonteru]

Hi VV,

another one. I want to understand how to make an entry. I know it would be a very wide subject. For eg if someone tells me to buy stone india-522085 and fedder llyod -500139( i am already into these stocks at lower levels) but for assumption purpose i get a tip and i want to study the TA aspect to be sure about investing at todays level. What would u look at and how would u time your entry.

Rgds

Rahul

U look at the chart. We are taught from the beginning of our childhood to be in order. U need to look for some order/pattern in the chart. Why? The chart shows data about thinking of people. U want to put Ur money on a stock which attracts like minded orderly people. So that we can predict some event (stock going up/down) with a degree of confidence (Do U remember probability in Math). For example, lets look at 2 charts:
1. Jai Prakash Associates
2. elgi thread
Let me know what U think. Where would U put Ur money. Which one will U trust more. Which one U can say confidently its going to go up or down.

Normally, U will look at a chart on an average couple of seconds. If U like it, write it down for further analysis. Don't force a position on a stock. If the chart is not good or chart is good but it is in over bought condition, skip the stock.

stone india-522085
-- Going in channel of narrow width. It would be hard for the stock to sustain the pace. Doesn't mean it cannot happen. I am just saying the probability of it happening is less. So, entry while in this channel should be avoided. Rather, wait for a pull back similar to what happened from 220 (17/4/2006) to 200 (25/4/2006) for entry.

fedder llyod -500139
-- See the chart. Good point for entry.

 

[vvonteru]

Setups for Monday: Look back as I place more
1. Fedder Lloyd (from previous reply)
2. Reliance Communications

Initial Profit Targets = Risk or High in the last 10 days.

 

[vvonteru]

Entry List:
Litaka Pharmacy (if U are not in already)
Hindustan Zinc (if U are not in already)
ALPHAGEO S
BATA INDIA
GARWARE OFFSHORE

 

[vvonteru]

Some more:

JAIPRAKASH HYD
LLOYD ELECT
Reliance Industries
VIDEOCON VCR
WEBEL-SL ENY
WHIRLPOOL

 

[rhk]

thanks...what do u think shuld be entry price for reliance industries, RCVL, litaka.

As for Hindustan Zinc, why do you think this one is a good buy.

Thanks

 

[rahulg77]

---Agree with Ur analysis. See attached chart. Have a stop with at least Buy Point - 40. Buy Point - 80 is better. However, if it goes below Rs 500 (at least 2 ticks)

Thanks VV,

I did not understand that have a stop with atleast buy point -40 and buy point 80 is better. And when u say that if it goes below 500( atleast 2 ticks) two ticks can be a big fall. this share in two ticks can even do down by 80-100 Rs or that is the room we have to give this share as it is in a nice uptrend.

Rgds

Rahul

 

[rahulg77]

HI VV,

i saw both the charts and ofcourse chart of Jaiprakash gives me more confident to get into. Have a few more questions. what do u mean going in channel of narrow width.

Also when we say fedder Llyod is good for entry point. I agree it is in a pull back but how do we know it will turn from here. it has not even got support from any MA too. Though it has a white candle and a white candle above this point would mean a emerging star.

What MA do u normally use to see resistance or u use 3-4 Moving avergae like 8, 12,20,50.

Also I did not see a explosive triangle pattern in JAi preakash. Could pls draw it and attach it and explain wht is this formation.

Too many small queries. Hope u will clear them.