Incisive Nifty Trend Analysis

[DSM]

Just my (non-technical) view :

The market has rallied back smartly every time it has fallen. While swing traders, can go long/short, short/long, a positional trader/investor has to take a much longer view. Seeing the market behavior, there's something THAT'S NOT IN THE CHARTS that gives a clue of the possible turn of events. In my opinion, the markets are positioning themselves for the next election to be held in Mid 2014. (The present Govt. completes its term in May-14) It seems likely that the current Govt. will be voted out, and the NDA with business friendly Modi at the helm may come to power. Just the fact that the current lame duck govt. will complete its term and the possibility of a majority voted Govt. coming into power is a good case for optimism. (Last election, the market closed with two circuit filters) on UPA II coming into power.

The FII's have been bullish and have invested over 13,000 crores this month (this coming after negative outflow of 22,000 crores over last three months) is quite significant by itself. Also, the rupee pullback is supporting the market.

So unless we have a globally adverse scenario for stocks, it does look like we need to position our investment portfolio on long side till mid 2014 atleast. And if, NDA is voted in with an absolute majority, there's no saying where the markets will end up.

Source :
http://www.moneycontrol.com/news/fiimf_activity/activity.php?flag=FII

Hi, In my post I've mentioned that we are at a very critical inflection point, which can alter the medium/long term trend of the market which has been down for more than 2.5 years now. Its going to be the final lap of the bull/bear fight that we've seen during this period. The case that I've presented is only my analysis based on high probability theory and investment decisions need to be made with your own judgement. Something is surely cooking fundamentally which you and I don't know and is only known to Mr. Market and which is getting discounted at the moment. Although, plenty of experts are extremely bearish at cmp, market can surely spring up a surprise or two in the next couple of months, Range of the market has seen compression on the downside both price wise and time wise since 2008. The broader market has outperformed extremely well on the downside and any further fall from here will surely make every one doubt/wonder whether some of these good quality companies really exist. With this background in my mind, I would as of now give 50% probability to the fact that market has bottomed out at recent lows. The ongoing correction seen after the recent upsurge is being corrected and I expect this to reverse by the second week of October. We need a close above 5930 for the uptrend to gain momentum once again. Expect range bound/whipsawing movement until then. Supports- (5790-5798)- 5752-(5710-5730- crucial area, wherein plenty of MAs converge)- 5680-(5630-5650)-5580.

All the best to your trading...

 

[toocool]

Just my (non-technical) view :

The market has rallied back smartly every time it has fallen. While swing traders, can go long/short, short/long, a positional trader/investor has to take a much longer view. Seeing the market behavior, there's something THAT'S NOT IN THE CHARTS that gives a clue of the possible turn of events. In my opinion, the markets are positioning themselves for the next election to be held in Mid 2014. (The present Govt. completes its term in May-14) It seems likely that the current Govt. will be voted out, and the NDA with business friendly Modi at the helm may come to power. Just the fact that the current lame duck govt. will complete its term and the possibility of a majority voted Govt. coming into power is a good case for optimism. (Last election, the market closed with two circuit filters) on UPA II coming into power.

The FII's have been bullish and have invested over 13,000 crores this month (this coming after negative outflow of 22,000 crores over last three months) is quite significant by itself. Also, the rupee pullback is supporting the market.

So unless we have a globally adverse scenario for stocks, it does look like we need to position our investment portfolio on long side till mid 2014 atleast. And if, NDA is voted in with an absolute majority, there's no saying where the markets will end up.

Source :
http://www.moneycontrol.com/news/fiimf_activity/activity.php?flag=FII

I had posted something very peculiar about the nature of the markets some 2 years ago in another forum, Let me get that and copy paste in my thread in a day or two

 

[prada]

Nifty update: Exit long positions or trail your stop if one is long in the market. Accumulate aggressive longs only if nifty closes above 5930-5935. Correction doesn't seem to be over. Will post an update once this move plays out.

PraDa

 

[prada]

Important pivot levels breached. Plenty of stops taken out. Trail your stops and stay bullish . 5730 has held out well on a closing basis. Fresh longs can be created by conservative traders once 5930 is taken out on closing basis for a swift run towards life time highs. Aggressive ones can start nibbling at current levels or on dips.

 

[prada]

Food for thought:

Popular belief states that Good analysts can never be successful traders and vice-versa. The reason for this can be attributed to biased approach. Generally, analysts are so biased in getting their analysis right that several trading opportunities go down begging because of their fixed mindset. So does one ignore/discard technical analysis completely? No! A balanced approach with strong technicals in mind and a very disciplined trading approach can take one to new heights in trading. Experience has taught me a lot in trading and in life which no school/formal education can teach. Its nice to revisit the basics of trading once in a while.

Firstly a trader should be very very clear whether he/she is an intraday trader, swing trader, positional trader etc. Time frame/horizon forms the basis of trading and a trader's success can be attributed to how well he adapts to the time frame fixed by him. If one enters the market without ascertaining a time frame, he might as well donate his/her money to charity instead of feeding the sharks lurking in stock market.

Next,The most fundamental aim in analysis should be to ascertain the broad trend of the market( this can differ from person to person on which time frame he/she is trading). This certainly helps the trader to orient himself in the direction of the market. Once this is clear, the next move should be to ascertain how the market is positioned( overheated/oversold)- with the help of momentum oscillators etc. If the broad trend is on the positive side, then wait for the market to pull back(if over heated) and enter after a meaningful correction. Levels to enter- generally fibonacci ratios/MAs give an excellent thumb rule for traders to begin with. Once an entry( after you are completely convinced) is made, fix a stoploss 10-15 points below the pivot low( or as per your trading method ) and ride the move by trailing your stoploss, and exit the trade at targets( Fibonacci extensions is a good tool to ascertain targets). Never worry about whipsawing movements or day to day movements( for positional traders) once you are convinced about your trade. Its most obvious that even the best of traders have " Bad hair days" once in a while. Discipline is extremely important in trading and as the famous saying goes " Chart your way to success...". All the best.

PraDa

 

[sridhar]

Food for thought:

Firstly a trader should be very very clear whether he/she is an intraday trader, swing trader, positional trader etc.

Levels to enter- generally fibonacci ratios/MAs give an excellent thumb rule for traders to begin with. Once an entry( after you are completely convinced) is made, fix a stoploss 10-15 points below the pivot low( or as per your trading method ) and ride the move by trailing your stoploss, and exit the trade at targets( Fibonacci extensions is a good tool to ascertain targets).

PraDa

Thanks a lot. I am working out a strategy for trading in Nifty Options with a time frame of 4 - 10 days. I have also found MA & Fibonacci along with SR levels (on daily time frame) give good results. I want to know whether to use High/Low levels or Open/Close values ( on daily charts) to calculate Fibonacci
levels?

Thanks

 

[prada]

Here we are... Trail your stoploss and hold onto your long positions tight. We are into second week of Oct and as expected Big move coming up. Bears get ready to be slaughtered.

Expect Bank Nifty to start participating in the rally from here on. Short term target 11300.

Nifty update: Unable to find time to post a comprehensive update. However a quick update on Nifty. Slightly risky call on nifty. Bulls can buy Nifty close to 5790-5800 with a stop at 5730( closing basis ). Target 6000 +. Yet to get convinced that momentum has waned out.

 

[timepass]

Here we are... Trail your stoploss and hold onto your long positions tight. We are into second week of Oct and as expected Big move coming up. Bears get ready to be slaughtered.

What about the bears who have already been slaughtered ??


just kidding.

 

[whisky]

What about the bears who have already been slaughtered ??


just kidding.

No options left for them, book loss go home.:lol::rofl:

 

[prada]

TP, I've been reading your posts quietly in other threads. A simple trend following strategy would have enabled you to make money in this recent rally from 5700. Anyways all the best with your future trades.

What about the bears who have already been slaughtered ??


just kidding.