Once I read, that round numbers pose as good resistance and support points no wonder my 50th post took me like four days(actually was busy with my 6 year old daughter’s cultural program….East or West, time spent with the Family is the Best!!!).
Coming to Nifty, we opened firm inline with our last week’s strength. Had a straight jab at the 200 DMA (and backed off). Nifty drifted between a tight range most of the time, it did give a double top trade, but then also frustrated coz the move down was not as swift as one would desire. Nevertheless we meandered down making lower tops and lower bottoms. It seems that due to the RBI meet on credit policy and the US FED meet, the traders want to keep light positions and then decide what shape the trend would take. Whatever is the outcome of these meetings, one thing is sure that this week might see some wild swings and test the nimbleness of traders.
If you look at the daily chart on the right (still rumble in the box) we are still between the two DMA’s and personally I feel we just might not trade through the 200 DMA and walk across with ease. We might need a gap up to break this resistance (just the way we gapped up at 4950) and for that we need a good trigger. Assuming that the gap we had at 4950 was a breakout gap and, if and only if we gap above 200 DMA then that would qualify as a continuation gap. It looks like a lull before the storm. I am guilty of being repetitive here, but I still feel that for the time being its better to trade in individual scrips than NIFTY. But then as they say its different strokes for different folks!
"If money is your hope for independence, you will never have it. The only real security that a man can have in the world is a reserve of knowledge, experience, and ability."
Henry Ford
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