Namaste - My Learning of Trading in Nifty

[crown]

India Infoline
Buy Price 116.90 (on 27 Oct 2010)
Current Price 115.85 (loss around 1%)

This script also gave a chance to exit above 122 levels, but I deliberately avoided and was ready for this downfall. Though, the down movement is more than expected; but even then, the script appears too strong to be compromised for some minor gains or losses.
I am just waiting for this script for close above 125, and then it can have reasonable upside rally for around 2-3 weeks. It has a strong base around 110 and I will be looking to add more positions at that level, in case it gives the opportunity.

Chart placed below:

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[crown]

Inox Leisure

Buy Price 72.65
Current price 72.10 (loss around 1%)

This script is risky and deceiving. Currently, trading near bottom levels but still having the momentum. It need to close and trade above 75 to be of some value.

Will be watching its movement closely.

chart placed below:

Uploaded with ImageShack.us

 

[crown]

Century Plyboard
Buy price - 69.7
Current Price - 66.35 (loss of around 5%)

The structure of the script is somewhat similar to Inox. From 29th Oct onwards, there has been some accumulation started in this script; and now is the testing period. It has to close and trade above 68 to be of some value. Not likely to be a easy trade to get out equal or with gains. The level of 65 is to be watched very carefully violation of which can cause more pain.
The coming week is very crucial for this script. Just keeping my fingers crossed.

Chart placed below:

Uploaded with ImageShack.us

 

[letsgrownow]

You have to understnd one thing very clearly crown, before taking any deicision in trading. - "TRADING IS NOT ABOUT READING WHOLE LOT OF BOOKS, LEARNING INDICATORS, PATTERNS ETC". If that is possible then just check and google on Trading and see how much material and books do you get. Why isnt everyone profitable then? Why is it then we still practically believe that market has 90 percent of losers and 10 percent of winners?

Somethings take time to grasp, and market is one of them. You will face ups and down, will want to quit out of losses, and face very difficult and frustrating moments. And with every moment you will understand where you did wrong. And you will explore more about your mistakes.

IMO rather then studying and reading so much, try to understand one thing at the time. If you want to learn patterns, then learn patterns only for the start. See the pattern formation, see the neckline breaks and compare the volume actions at the key points. If you want to do it options+options or futures+futures then concentrate on that only. If you want to go with indicators, then choose one which you understand.

Reading hell lot of books and material will confuse you at the moment. I dont say that it wont help you. It definitely will. But not at the moment. You will read it today and will get confused. Some day you will gain understanding in market over time and you will just look into the past to acknowledge that what you read was totally right, but you couldnt just apply it. Problem is that when we are new to market, we read alot of thing, grasp so much rules, but our mind is not adaptable to apply that much rules at a single chart. We miss some rules, cause we are not adapted to the system. This thing gets developed over time. So chill.

As an initial advice. Never forget to place stoploss. That will help you stay longer in market. And dont give up.

Hope it helps.

take care

Great Advice Sir,

Actually I am new to this ocean but trying to follow treader ji's expert to gain the confidence. Before reading this thread sir, I could have also start reading and studying the things but you saved my time.
Thanks for your extended help.
God Bless you.

Bhupesh

 

[josh1]

On a closer inspection of the charts, I find that there are actually two shoulders on each side and two necklines. First one which is drawn by joining bottoms of 30th September and 18th October was at 6003 and it was broken decisively yesterday. The volumes had been falling from left shoulder to the right shoulder. This is a typical characteristic of H&S formation. Note the huge volume on breakout yesterday, though this is not necessary for H&S top. (Market can go down because there is no buyer at high price).

The distance measured from top of the head (6284 on 14th Oct) to the bottom of head (5985 18th Oct) is 299 points. Break out was at 6003. I therefore expect nifty to fall up to 5704 which is minimum implication of H&S formation.

The 50 DMA is currently placed at 5834. Therefore a pullback from 5870-6000 to the neckline is possible.

Since the H&S formation is not visible in weekly charts, I do not expect it to have a severe impact lasting more than a month or two.

These are my observations. I welcome criticism if I have erred on technical details.

So it was my mistake of interpretation. (Charts only show the facts).
I should have waited for close below second neckline.

 

[josh1]

Some day you will gain understanding in market over time and you will just look into the past to acknowledge that what you read was totally right, but you couldnt just apply it. Problem is that when we are new to market, we read alot of thing, grasp so much rules, but our mind is not adaptable to apply that much rules at a single chart. We miss some rules, cause we are not adapted to the system. This thing gets developed over time. So chill.

I have revised my interpretation. Though the probable H&S formation was not complete, the megaphone top is still a possibility. Support of 6000 is still very crucial and I feel that Nifty will test it on Monday. Below that there is minor support at 5950. If nifty closes below that, we may have to forget all longs for the time being.

Here is latest chart of Dow. It has closed below its 14 DMA first time after 31 August 2010

 

[crown]

I have revised my interpretation. Though the probable H&S formation was not complete, the megaphone top is still a possibility. Support of 6000 is still very crucial and I feel that Nifty will test it on Monday. Below that there is minor support at 5950. If nifty closes below that, we may have to forget all longs for the time being.

Here is latest chart of Dow. It has closed below its 14 DMA first time after 31 August 2010

Read this

Namaste

There are things which Technical/Fundamental Analysis can explain; for every thing else - There is the Market itself.

What should be the strategy now?

Well, I have exited from around 50% of the shorts in Nifty and now holding the remaining. I will be exiting from all Shorts in Nifty between 6000-5950; the moment Nifty starts trading below 6000 - that will be the time for me to start building long positions in Nifty and other stocks which are having good structure and upside momentum.

The uptrend is still intact in my Charts and till now I think, I have been fairly successful in assessing the market movements.

There are 99% chances (except God no-one else could be 100% sure of anything in this world) that Nifty shall take support around 5930 levels . And, there are very very meek chances that Nifty can close below 5900. And, the downside movement of the Nifty is expected to be over within next 2 trading sessions i.e. by the end of 16 Nov 2010 the selling will be complete and the operators may start accumulating/going long in the Market. On 19th November, I am expecting a positive close (green candle) in Nifty

In case, Nifty take support above 6000 levels, it is very likely to be a fake and short lived. It will be only after violating the 6000 levels in the downside, that Nifty can have another upside rally.

 

[crown]

covered all shorts in Nifty :clapping::clap::lol::thumb:
now waiting for the bulls to come either today or in next coming two trading sessions.
will be adding long positions on next coming trading sessions.
added one long position in Nifty today

 

[crown]

I find that Nifty has found the bottom now.
Though I was expecting it to be near 5950, but perhaps 5983 has been accepted as current support. Even if Nifty goes below 5983 now, the downside is very very limited.

Added one long position in Nifty today and will be adding more after watching the movement of today and the next trading session.

Let me see how Nifty move in the remaining trading session of today

 

[crown]

Accumulation started by the bulls
6020 is the point to check, trading above 6020 will confirm it
5960 is the support for today
overall trend is still bullish