Friday, April 30, 2010
Thursday, April 29, 2010
Tuesday, April 27, 2010
Is Sugar Going To Be Sweet???
Off late a couple of my posts had been on OS stocks, which gave some good bounces, and speaking of Oversold one sector that’s really oversold is the sugar sector! Look at the recent reading of RSI on a few select sugar stocks;
And now the charts of some sugar stocks showing OS levels;
Speaking of charts, I thought let me put up the charts of Renuka and BajajHind, both sugar stocks and favorite with the daytraders and punters! In the chart below, of Renuka, you can see that it has retraced almost 61.8% percent (marked on the weekly chart in the centre) and now just a wee above the 200 periods MA, making a 60/58, support areas! A OS bounce on hourly above 64 can target 72/78 levels.
And now the chart of BajajHind, as one can see its OS in all the three time frames, an OS bounce above 126 can target 130 and then 140!!!
Once again I reiterate that we are talking about OS bounces here, and ofcourse all this has to played in tandem with the broader market!
Monday, April 26, 2010
Sunday, April 25, 2010
ABAN Views!!!
ABAN is a favorite with the traders and intra-day players also have a liking to it. Below are the hourly and the daily chart of ABAN for some quick analysis. Technically ABAN is in bearish mode considering the fact that it is trading below its key moving averages in both the daily and the hourly time frames!
From the hourly chart above (Left), we can see that the price has retraced 61.8% of the recent fall, but failed to hold onto the gains, making 1230 an important resistance on the hourly timeframe! The daily chart (right) is a clear picture on how confused things are with this one- TRIANGLE! It’s a simple rule that either break of 1250 or 1190, will decide the direction of the trade. Conservative stops in both the scenarios becomes 1190 for longs and 1250 for shorts, whereas aggressive stops can be placed at 1225/30 (avg price for last 10 days 1227!) for initiating trades on either side!
Saturday, April 24, 2010
Thursday, April 22, 2010
Wednesday, April 21, 2010
Nifty Views!!!
Hmmmm…is it a start of a full blown correction or is it a simple pullback in an uptrend?
To phrase it a lil bit differently is the glass half full or half empty?
Well a trader is faced with these questions quite often, and then the answer often depends upon the bias that the individual is carrying for that particular day or week. Simply put sometimes our bias also gets guided or influenced by our trades. For example if you are short from 5300 odd levels then your outlook is bearish (damn we have a correction on our hands), on the other hand if you are long at 5200 then your outlook is bullish (gee I am lucky to have bought into the pullback)! Whose right here? Well both scenarios are correct, but there is one common factor which can make both go wrong, and that is the lack of discipline and failing to adhere to their respective trade plans.
Why I started on a preachy note was coz Nifty is critically poised, at where both the Bulls and the Bears get to test their faith! What’s happened so far, and what makes this a pullback;
· We retraced normal to 38.2% fib from the top
· We are back at the sweet spot aka value zone i.e. between the MA’s often looked upon as an important buy point
· We did make a new lower low (for time being) but yet to make a significant lower high!
And what would make this a start of a correction (also read the previous post);
· We drift from here means we have a Lower High
· We break the recent pivot low
· We trade below the key MA’s
What’s the status quo? Well we have two Inside bars vis a vis the Monday’s bar, therefore the hi and lo of that bar become significant…infact most of the stops (for shorts and longs) would be in that vicinity! Technically it’s almost a 100 pointer intra play field with the Bulls at 5280 and Bears at 5180…let us see who leads the pigs to the slaughterhouse??? To sum it up;
"Don't judge each day by the harvest you reap, but by the seeds you plant." Robert Stevenson
Tuesday, April 20, 2010
Tech Mahindra Views!!!
Tech Mahindra is another stock that’s coming on my screen as kinda real oversold and ready for a reversal (refer to my post on BEL yesterday…it’s up by 1.5% today). Posting below is the daily chart (on your right) and the hourly chart (on your left). The daily has clear BEARISH annotations to it; it’s trading below the 200 periods MA, both the 20 and 50 periods MA’s are sloping downwards with 20 cutting across the 200! Technically TechM is at important support coz below this we just have the 800 by the virtue of being a whole number support and then some logical support comes in at 750/60!
From the hourly chart above we can see price is kinda stalling and looking for a pause. 830/35 is proving a chore for it…the 20 periods MA also there. A tradable OS bounce from here can take this to 850 and 860/65 provided the Nifty obliges!
I am not suggesting that it will reverse from here definitely, what I am tryin2say is that when you come across such oversold stocks you are better off if you monitor and follow them every day. When they begin to reverse place a protective stop under your buy point and go long. If a stock is dropping stay on the sidelines and wait patiently for some reversal signs. Most of us have a difficult time with the concept of overbought and oversold and especially Divergences coz many a time we tend to act on Divergences formed o horizontal ranges…a strict no-no!!!. We all know now (the market is a great teacher) extreme bearish conditions become bullish and extreme bullish conditions become bearish. The key is to ascertain the degree of both conditions and taking the call!
Nifty Future Update!!!
Posting both the daily as well as the hourly chart of the Nifty Future (time is noon still another three hours to go till the close!) and illustrating the direction of the channels (regression)…the coloring is for that Technicolor effect!
The chart on your left is the daily, a quick rebound from the 50 periods MA yesterday (in blue) and now back to kiss/test the 20 periods MA above!
The chart above towards your right is the hourly, and as mentioned in the previous post, a bounce from hourly OS levels (courtesy strong overnight DOW) is not ruled out, and that’s what we are witnessing now. At the last candle (on the hourly) we have touched the 200 and the 20 periods, closed the gap and also retraced 38.2% from the lows, and now frankly speaking clueless or rather looking for clues as to, what to do NEXT???
Speaking of being clueless, take a look at the 5 mins NF chart below;
We are stalling at the gap area; and into the frustrating zone for the eager beavers (intra players). A short at 5250/60 can be initiated for takeaway but for intraday shorts it would be prudish to wait till we crack the 5245 area (range break/TL break/MA break!)
Yes we did witness a mild negative divergence on the 5 mins chart but as the rulez say
“ALWAYS WAIT FOR THE PRICE TO CONFIRM”
Monday, April 19, 2010
Bharat Electronics Views!!!
Bharat Electronics (BEL) was already in the sell mode much before Nifty; hence it is kinda in an oversold state in the falling market. What you see below is the hourly and the daily chart of BEL!
From the daily chart above(to your left) we can see that BEL has drifted way too below the 20/50 MA’s and is trading above the 200 MA.…kinda in a suspended animation! It needs to fall further and touch the 200 MA below, or at least pause here and consolidate, so as to enable the 200 MA to rise or let the 20 MA overhead fall further to align itself with the price! The hourly chart (to your right) is also reacting form oversold levels with hints of positive divergence. The narrow range inside bar on the hourly (marked) chart gave a very good low risk entry (entry at 1860, stop at 1849, targets 1880 and 1900) for a tradable bounce!
Saturday, April 17, 2010
Tanla Solutions Views!!!
Below is the chart of Tanla Solutions brought to my notice by a friend Raj Baheti.
Tanla Solutions is amongst the first Indian companies that focused on integrated solutions and products for the wireless world, Tanla carved its niche in the mobile communications industry very early on with a rare distinction of rolling out its sophisticated SMSC product within three months of inception. Tanla was the first Indian company to indigenously make the SMSC and VMS that now successfully compete with offerings from established global players. Its SMSC has been deployed by leading players in India's telecom industry, including Reliance, BPL, Hexacom, Airtel and Essar. Company website and some more info !
Getting back to what we do here...analyze! From the chart below we can see that this stock is at consolidation mode from the last three months. Incidentally these levels are also the 61.8% fib if drawn from the 2009 Feb lows to 2009 June Highs! Yes there was a positive divergence in the indicators below which seem to have worked their way with this recent upmove yesterday (Tanla Solutions surged 5.42% to Rs 48.65 at 10:35 IST on BSE after 3.18% of equity changed hands in a bulk deal on the BSE).
The stock seemed to have closed just shy of the 50 periods MA. Unfortunately with the broader market overbought and ripe for correction this can also come under some pressure. If one is already a buyer then a strict stop under 45 is warranted. If one plans to go long then a buying above 50 is good idea or wait for it to get pulled back (coz of weakness in market) to 45 odd levels and hold steady for the overhead target of 58/60 where the falling 200 periods along with the TL might pose a lil resistance!
Wednesday, April 14, 2010
Nifty Views!!!
Below is the daily chart of Nifty; Quite colorful! As one can see I have tried to let my imagination run wild with those lines and colors. Ok done with coloring contest, let us see if we can infer some things from what the Nifty is tryin2show us or rather we seeing what we are tryin2convince ourselves to believe!
From the chart above we have;
- A broader range shaded in yellow
- A recent laborious rise in drawn in purple channel
- An assumption of a Wolfe Wave (at least I assume it might pan out that way).
I have already spoken about drifting too far from the MA’s and Divergences etc in this post, and I still stand by the same analysis. The upmove is showing signs of fatigue and now with the earnings seasons on, any surprise might get Nifty moving either side!
Bulls don’t have anything to worry about (other than slow frustrating moves upwards which rob the sheen out the rally) as long as the 5300/5250 is held on dips.
Tuesday, April 13, 2010
Monday, April 12, 2010
TataComm Views!!!
I had earlier written a few posts about Tata Comm..I owe this stock..but I must also admit that I OWE this not by choice but under duress! Yups…I bought and I was right on my analysis and I was also foolish enuff to hold it when it got my stop…as they say my swing trade morphed into my long term investment!
What I did or practiced was an example of self destruct in trading…anyway made amends and once again promised myself that I ought to stick to Rulez! Anyway speaking of tatacomm (not getting into any talk about 3G auctions and its effects etc etc), what you see above, are the daily and the weekly charts towards your left and the right respectively. The charts are sufficiently annotated. A buy above 300 with a strict 15 pointer SL can be considered for a target 0f 335/340! As for shorting it… I aint interested…!
Sunday, April 4, 2010
Saturday, April 3, 2010
I am Back!!!
I have taken tooooo long a break from blogging and trading, as I was caught up in a lot of mess which just comes unannounced. Hmmm I guess these are those hidden mysteries that life has in store for you and it springs on you from time to time to make you know that how mortal and fragile you are!
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