I can help you with stock chart reading
- Thread starter vvonteru
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It is a bull market with high valuations. There is lot of volatility. Combined with it, there are Market Makers who look at your close stops. They move the stock, touch your stop and go back (since there is no demand to sell further or there is high demand to buy at that point). So, when you put Ur stops, U have to consider:
1. Volatility of the stock. How much it can go down in a day. High - Low.
2. Whether the risk will fit your money management plan or Ur confirtability. The stock may be good for entry. But, if the stop has to be far, move on to the next one.
The reason I have the stop far than it should be is to avoid getting hit due to daily volatility. When I say 2 ticks, I am trying say, the stock should really go down. Not thru manipulation. However, if U can't look at the stock in day time, i.e., hands of approach, give actual stop. In this case, something below 500.
1. Volatility of the stock. How much it can go down in a day. High - Low.
2. Whether the risk will fit your money management plan or Ur confirtability. The stock may be good for entry. But, if the stop has to be far, move on to the next one.
The reason I have the stop far than it should be is to avoid getting hit due to daily volatility. When I say 2 ticks, I am trying say, the stock should really go down. Not thru manipulation. However, if U can't look at the stock in day time, i.e., hands of approach, give actual stop. In this case, something below 500.
Narrow channel
--- The channel is formed by couple of ticks. There is no pattern of pull back after the previous one. I am just saying, wait for a similar pull back. Don't buy during this travel in small channel. The stock has no room to move around. It will be hard for it continue this pattern for long time, as people may not trust it will do it for long time. It is just my observation based on experience.
See, there is no right or wrong in analysis. It is just my view versus Ur view. I may be right one time, U may be on another occation. But, if U base Ur analysis on a set of principles (methodology) and trade, there are high chances that U will be right more than U are wrong. If U don't after a while, U need to modify/change Ur principles. Most the people try/think they can get it 100% right. Its not possible.
fedder Llyod
--- U are looking for support from MA. Not all stocks trade that way. Each has its own way of trading, just like different people think differently. How do I know it will turn around? Who said it will turn around. I pick it because of its high probability of turning up versus down. But, it may not. Thats the reason we have a stop, in case it turns down. Many people don't understand STOP. We put a stop for a reason. That our analysis can go wrong. If it does, we come out with a reasonable loss, which is the business risk.
Japanese Candles
--- I don't follow it. If it helps to avoid a bad trade, thats good for U. I will read about it in the future.
MA
--- I use EMA 8, 50, 200.
Triangle Pattern
--- I already have it in the chart. By, explosive, I mean, the base is not formed. Normally, the base is formed and tip is not formed. At the end of the tip, the stock has to make a decision to go up or down. In this case, the end of the current pattern comes when the stock no longer is forming the base of the triange.
--- The channel is formed by couple of ticks. There is no pattern of pull back after the previous one. I am just saying, wait for a similar pull back. Don't buy during this travel in small channel. The stock has no room to move around. It will be hard for it continue this pattern for long time, as people may not trust it will do it for long time. It is just my observation based on experience.
See, there is no right or wrong in analysis. It is just my view versus Ur view. I may be right one time, U may be on another occation. But, if U base Ur analysis on a set of principles (methodology) and trade, there are high chances that U will be right more than U are wrong. If U don't after a while, U need to modify/change Ur principles. Most the people try/think they can get it 100% right. Its not possible.
fedder Llyod
--- U are looking for support from MA. Not all stocks trade that way. Each has its own way of trading, just like different people think differently. How do I know it will turn around? Who said it will turn around. I pick it because of its high probability of turning up versus down. But, it may not. Thats the reason we have a stop, in case it turns down. Many people don't understand STOP. We put a stop for a reason. That our analysis can go wrong. If it does, we come out with a reasonable loss, which is the business risk.
Japanese Candles
--- I don't follow it. If it helps to avoid a bad trade, thats good for U. I will read about it in the future.
MA
--- I use EMA 8, 50, 200.
Triangle Pattern
--- I already have it in the chart. By, explosive, I mean, the base is not formed. Normally, the base is formed and tip is not formed. At the end of the tip, the stock has to make a decision to go up or down. In this case, the end of the current pattern comes when the stock no longer is forming the base of the triange.
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Can you please tell me if TFCILTD has formed a double bottom?. Is it safe to enter now?.
Scrip - Tourism finance corporation of india
Code - TFCILTD.NS
-- Avoid the stock. Still in downtrend. Draw a line joining points 24, 20, 17. Further, avoid cherry picking in the current market. I don't know whether U read about my anology of falling from steps. If U have not, here it is.
Imagine U have fallen from 10 steps. U are trying to recover. U are about to get up. But, U see this gush of wind in the proportion of cyclone. Can U guess what will happen to U. Will U get up or fall down. If U do fall down, how long will it take to get up again after that hit.
The reason I gave U that analogy is, the market had a bad hit today. It has come back to the previous trading range. This is bad. When market loses so many points, these beaten down stocks get killed more. At this point, its just not this stock, avoid entries to all stocks. I will cover this further below.
BTW, I like U giving me the scrip name and code. Makes my life easier. Thanks
Can u please tell me something about the prospects of Mawana Sugar,
I have purchased it at @132.59.
Should I keep it and wait or book losses
--- Now it is 108.05. If it goes down below 100, don't keep it.
Market Commentary:
When it had 2 days pull back, I thought, this is what I wanted on Friday night. But, looking at world markets, I had a bad feeling on Sunday evening. But, I did give benefit of doubt to Indian Bull Market. I can't say I was not surprised the way it happened. At this point, lets adopt wait and see approach for couple of days to get better understanding what today's price action means. Hopefully, 50 day EMA will act as support for Nifty and Sensex. If U have existing positions, take partial profits or/and trail Ur stops to make Urself comfortable. Avoid new entries for now.
About the positions I suggested with entries and stops:
RCVL, Reliance, Hindustan Zinc and fedder Llyod did not hit the buy point. So, we are saved by the bell. This stresses the importance of not buying directly into a stock. Try to buy at a point where U feel the stock really has scope for turning back. This is called, 'No Ticky, No Tacky'. Its like saying to the stock, 'If U don't perform, U will not get rewarded with my money'. Ofcourse, there will be times, where Ur buy point will be hit and then the stock comes down. Didn't I say in my previous reply that there is no full (fool) proof method. We just do the best.
Scrip - Tourism finance corporation of india
Code - TFCILTD.NS
-- Avoid the stock. Still in downtrend. Draw a line joining points 24, 20, 17. Further, avoid cherry picking in the current market. I don't know whether U read about my anology of falling from steps. If U have not, here it is.
Imagine U have fallen from 10 steps. U are trying to recover. U are about to get up. But, U see this gush of wind in the proportion of cyclone. Can U guess what will happen to U. Will U get up or fall down. If U do fall down, how long will it take to get up again after that hit.
The reason I gave U that analogy is, the market had a bad hit today. It has come back to the previous trading range. This is bad. When market loses so many points, these beaten down stocks get killed more. At this point, its just not this stock, avoid entries to all stocks. I will cover this further below.
BTW, I like U giving me the scrip name and code. Makes my life easier. Thanks
Can u please tell me something about the prospects of Mawana Sugar,
I have purchased it at @132.59.
Should I keep it and wait or book losses
--- Now it is 108.05. If it goes down below 100, don't keep it.
Market Commentary:
When it had 2 days pull back, I thought, this is what I wanted on Friday night. But, looking at world markets, I had a bad feeling on Sunday evening. But, I did give benefit of doubt to Indian Bull Market. I can't say I was not surprised the way it happened. At this point, lets adopt wait and see approach for couple of days to get better understanding what today's price action means. Hopefully, 50 day EMA will act as support for Nifty and Sensex. If U have existing positions, take partial profits or/and trail Ur stops to make Urself comfortable. Avoid new entries for now.
About the positions I suggested with entries and stops:
RCVL, Reliance, Hindustan Zinc and fedder Llyod did not hit the buy point. So, we are saved by the bell. This stresses the importance of not buying directly into a stock. Try to buy at a point where U feel the stock really has scope for turning back. This is called, 'No Ticky, No Tacky'. Its like saying to the stock, 'If U don't perform, U will not get rewarded with my money'. Ofcourse, there will be times, where Ur buy point will be hit and then the stock comes down. Didn't I say in my previous reply that there is no full (fool) proof method. We just do the best.
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Hi VV,
Agreed our buy point did not hit so we will reduce our buy point. now our buy point will be if tomm it goes above todays hi. If the correction continues will we keep reducing our buy point like this? what if the indicators turn negative or it goes below previous pivot low...do we wait for it to make an uptrend again or we still buy knowing that the pull back was cause of overall market and not stock specific. also we buy above the previous high during same trading day or it should close above the previous high.
Rgds
Rahul
Agreed our buy point did not hit so we will reduce our buy point. now our buy point will be if tomm it goes above todays hi. If the correction continues will we keep reducing our buy point like this? what if the indicators turn negative or it goes below previous pivot low...do we wait for it to make an uptrend again or we still buy knowing that the pull back was cause of overall market and not stock specific. also we buy above the previous high during same trading day or it should close above the previous high.
Rgds
Rahul
When U decide to buy a stock (based on a tip or scan), Ur analysis starts with the market indexes. U will do the following.
1. Look at BSE500 (Look at others too: BSE200, BSE100, BSE30-sensex)
2. Look at Nifty
3. Identify industry and sector of the stock. Sometimes, U will not be able to get the charts for these. There are BSE indexes for some sectors. Look at chart of the sector.
Our objective in looking at overall indexes and sector is to get a feel for the market conditions. We are trying to understand how all the traders are thinking.
Based on the above reading, if U feel the conditions are good, then compare the stock U want to buy with the sector. The stock should be comparable to the sector. Then U will make a buy or no buy decision.
I know the process feels long. But, thats what I call principles/methodology. It should be a repeatable process. Then, U can evaluate the results with some certainty. Try to take out degree of guessing, affected by greed and fear. Avoid gambling.
When a Tree (market) falls down, what happens to the branches (sectors) and the leaves (stocks)? Hope I answered Ur question.
Looking at the pull back in the evening, determine Ur entry point based on our strategy. On the trading day (next day), if the buy point is reached, enter. The buying point does not have to be previous day's high + x. If U look at the charts I have given previously, U will notice that in some cases, it was couple of days back high + x. It all depends on the change happened in a day and the volatility of the stock. U will get that with experience.
So, looking at the current market conditions, I am adopting a wait and see approach for next few days. If the market indexes improve from these current levels, we will look at new setups. For tomorrow, I suggest no entries.
1. Look at BSE500 (Look at others too: BSE200, BSE100, BSE30-sensex)
2. Look at Nifty
3. Identify industry and sector of the stock. Sometimes, U will not be able to get the charts for these. There are BSE indexes for some sectors. Look at chart of the sector.
Our objective in looking at overall indexes and sector is to get a feel for the market conditions. We are trying to understand how all the traders are thinking.
Based on the above reading, if U feel the conditions are good, then compare the stock U want to buy with the sector. The stock should be comparable to the sector. Then U will make a buy or no buy decision.
I know the process feels long. But, thats what I call principles/methodology. It should be a repeatable process. Then, U can evaluate the results with some certainty. Try to take out degree of guessing, affected by greed and fear. Avoid gambling.
When a Tree (market) falls down, what happens to the branches (sectors) and the leaves (stocks)? Hope I answered Ur question.
Looking at the pull back in the evening, determine Ur entry point based on our strategy. On the trading day (next day), if the buy point is reached, enter. The buying point does not have to be previous day's high + x. If U look at the charts I have given previously, U will notice that in some cases, it was couple of days back high + x. It all depends on the change happened in a day and the volatility of the stock. U will get that with experience.
So, looking at the current market conditions, I am adopting a wait and see approach for next few days. If the market indexes improve from these current levels, we will look at new setups. For tomorrow, I suggest no entries.
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Hello,
i entered the following stocks a week ago at the following price..
1. JP Hydro @ Rs 39.20
2. Essar oil @ Rs 74.45
3. RCVL @ 337
What is your views and suggestion on this stocks.Shd i hold or exit and at wht levels shd i make an exit.your fast reply would be much appreciated.
Thanks
Mohammed Bin Haid
i entered the following stocks a week ago at the following price..
1. JP Hydro @ Rs 39.20
2. Essar oil @ Rs 74.45
3. RCVL @ 337
What is your views and suggestion on this stocks.Shd i hold or exit and at wht levels shd i make an exit.your fast reply would be much appreciated.
Thanks
Mohammed Bin Haid
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