Weekly update:
Global Update- Markets worldwide came under intense selling pressure and recouped some of their losses towards the end of the week. The only market which has clearly shown signs of trend reversal has been the Hang Seng index. Hang Seng should see some relief rally next week before beginning its downward journey again. This market is surely ahead in its correction and other markets are expected to follow this trend in the near term. As far as US markets are concerned, movement remains quite choppy and participation remains extremely low and CBOE VIX has surged quite a bit from its lows. I expect US markets to remain under pressure in the near term and some clarity should emerge in the next couple of weeks.
Coming to our markets. Nifty has shown first signs of a break down this week and will continue to remain weak until it trades below 5400 from here on. In my last week's update I indicated about the importance in watching DII selling closely for a trend reversal. We are almost at the point of a major trend reversal, I say almost because we need some more clarity to figure out whether this is a trend reversal or a correction. Broad movement of Nifty I see in the next few months would be a retest of 5032 and then bouncing back to test 5300, giving a feeling that we are in a bull market without doubt and 5000 would be the base for the next decade, only to come crashing down on extremely high volumes thereafter to breach 5000 and break through all the moving averages and trendlines creating panic selling and taking out all the stoplosses and head much much lower. This remains the high probability according to me out of my experience of over a decade in the market ( sometimes market does its own thing ). Let us see!
EUR/USD- This currency pair hit a multi-week high on Friday, pulling some herd in its direction. I see a major trend reversal happening in the next few weeks, as it is quite close to its top.
Have a good weekend!
Global Update- Markets worldwide came under intense selling pressure and recouped some of their losses towards the end of the week. The only market which has clearly shown signs of trend reversal has been the Hang Seng index. Hang Seng should see some relief rally next week before beginning its downward journey again. This market is surely ahead in its correction and other markets are expected to follow this trend in the near term. As far as US markets are concerned, movement remains quite choppy and participation remains extremely low and CBOE VIX has surged quite a bit from its lows. I expect US markets to remain under pressure in the near term and some clarity should emerge in the next couple of weeks.
Coming to our markets. Nifty has shown first signs of a break down this week and will continue to remain weak until it trades below 5400 from here on. In my last week's update I indicated about the importance in watching DII selling closely for a trend reversal. We are almost at the point of a major trend reversal, I say almost because we need some more clarity to figure out whether this is a trend reversal or a correction. Broad movement of Nifty I see in the next few months would be a retest of 5032 and then bouncing back to test 5300, giving a feeling that we are in a bull market without doubt and 5000 would be the base for the next decade, only to come crashing down on extremely high volumes thereafter to breach 5000 and break through all the moving averages and trendlines creating panic selling and taking out all the stoplosses and head much much lower. This remains the high probability according to me out of my experience of over a decade in the market ( sometimes market does its own thing ). Let us see!
EUR/USD- This currency pair hit a multi-week high on Friday, pulling some herd in its direction. I see a major trend reversal happening in the next few weeks, as it is quite close to its top.
Have a good weekend!
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SBI- CMP- 1837
India's premier PSU bank looks terribly weak on the charts and is holding on to the may 2012 lows of 1800. Once this level is breached decisively , I have a technical target of 1580 on this stock. Eventually I expect 2011 lows to be breached pulling down the Bank Nifty along with it. Short terms bounces will be witnessed here and there but the target remains intact. Please let me know when the target is hit!
Broad pattern of movement expected from current levels- 1580-1790-1280
India's premier PSU bank looks terribly weak on the charts and is holding on to the may 2012 lows of 1800. Once this level is breached decisively , I have a technical target of 1580 on this stock. Eventually I expect 2011 lows to be breached pulling down the Bank Nifty along with it. Short terms bounces will be witnessed here and there but the target remains intact. Please let me know when the target is hit!
Broad pattern of movement expected from current levels- 1580-1790-1280
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Think about it. If you really truly
believed that every person who traded
was a market variable with the potential
to cause prices to go in any particular
direction, and there was no possible
way you could get into the mind of
every trader with the potential to put on
a trade, then how in the world could you
ever know, for sure, what was going to
happen next?....
There is indeed, and that means the
market produces patterns, and the patterns
in turn will generate an outcome
with a higher probability of one thing
happening over another. The outcome
to each individual pattern is random.
But people don’t believe that! And that’s
the problem.
a quote from...Mark Douglas And The Disciplined Trader
believed that every person who traded
was a market variable with the potential
to cause prices to go in any particular
direction, and there was no possible
way you could get into the mind of
every trader with the potential to put on
a trade, then how in the world could you
ever know, for sure, what was going to
happen next?....
There is indeed, and that means the
market produces patterns, and the patterns
in turn will generate an outcome
with a higher probability of one thing
happening over another. The outcome
to each individual pattern is random.
But people don’t believe that! And that’s
the problem.
a quote from...Mark Douglas And The Disciplined Trader
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