Monthly Archives: October 2013

Nifty & Bank Nifty Weekly Technical Outlook for 21st Oct, 2013

Nifty Daily Chart

Nifty Daily Chart

Bank Nifty Daily Chart

Bank Nifty Daily Chart

Experience is One thing, you can’t get for nothing – Oscar Wilde

Whenever market reaches to top, Euphoria starts building up. By and large every other participant has feeling of greed which drives them to the market, and if they don’t participate now then when they will come. There are group of market analyst who has feeling of fear that if at all they miss this rally then for sure they will be handed over with Pink Slips, so they start projecting higher levels. (We heard 7000+ levels). Few brokerage houses are ready for their Diwali Picks and Projections and ready to push their outlook to support their deteriorating margins. If we just cross check two months back market sentiment than, everything was messy, the same group of people was talking about 4500 levels and now 7000+.

Lets understand where this market is heading for.

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Market in Past…

Whenever market reaches near tops, euphoria starts building up, everyone will start talking about higher and higher levels. Experience suggests that it’s time to stay alert. This time there is lot of difference between Aug’08 rally, Nov’10 rally and this rally.

In 2008, it was clear up trending market, and still we remember every Tom, Dick & Harry wants to be part of the market, including this author. It was the market, where every Large Cap and Mid Cap and even Small Caps were in news. Analysts were looking better value in every stock. Graduating student want to either be Analyst or Investment Banker. We have seen in Mumbai Local Trains people started talking about Sensex and Nifty (Similar or much better scenario was developed in the Dot Com Bubble 1998-2001)

From the beginning of 2008 till end market was in clear downtrend, tested almost 2250 levels from the highs of 6357.10, which was one of the sharpest fall in the history of Indian Stock Market. Lehman Brothers Collapsed and within a year our Indian Market has lost almost 65% of price gains. Everything was scary at this time.

Then market formed a bottom in next 3 months of 2009 and started fresh up leg, but here nobody has guts to come and accept the challenge.     From 2009 to near the end of 2010 more or less market remained positive and expectation were high. Finally on 5 Nov’10 Nifty posted a high of 6338.50 which was slightly lower than high of 2008; it was again the time of Diwali, brokers were out with their rosy reports of the market and running behind to suggest some multi-beggar stock ideas which can make their clients wealthier. Rest is history and everybody knows that what happens just next day after Diwali.

From End of 2010 to end of 2011 market re-entered into bad phase (as a bull by mentality, we can’t accept the fact of falling market), but this time market formed a higher bottom at 4531 in Dec’11, and started moving higher.

Now, if we analyze price action from the beginning of 2012 than we can notice that, initial two months of 2012 was giving clear sign that market has started fresh impulse leg, but subsequent move is little choppy, where you have to keep cross check on every move of the market.

Up to Jan’13 rally was in tandem (that is what we believe), correction from Feb’13 to mid Apr’13 was fine, but rest all move is little skeptical. Recently in Aug’13 market posted a low of 5118 and recovered from that low in matter of eight weeks (till date) is little surprising.

Little technical here, if we ignore earlier leg and consider move Aug low of 5118 to 18 Oct’13 Friday’s high of 6201, in totality its almost 1082 points move which 21% rise, that too in very short span of time, forcing everyone to relook at things. Because, till date these move is appearing in 3 wave structure. Now considering this thing, if it is fresh Impulse leg than maybe we can expect much higher levels.

But, if we understand and analyze market sentiment, than it is suggesting one obvious thing that don’t get carried away, at Tops we’ll always find Euphoria Building up and that is trap where every Retail participant fall into.

Nifty and Bank Nifty Technical Analysis for 18 Oct’13

Nifty as on 17 Oct’13– 6045.85 (-43.20)    Bank Nifty as on 17 Oct’13– 10336.60 (-52.70)

Talk of the town was CNX IT Index, which plummeted sharply in the day. CNX IT Index 8797.85 lost 322.45 down by more than 3.5% in an intraday session. Even Nifty and Bank Nifty remained weak, but it traded on a choppy note. Ultimately, traders who were focused on IT Index minted money, rest all were waiting for better sell level towards 6200+ as it was an ideal level to go for short.

Although Nifty gave away 43 points, but Bank Nifty was only down by 52 points, and in fact in an intraday session it tried to recover the losses, which indicates that buying is emerging at lower levels.

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Nifty and Bank Nifty Technical Analysis for 17 Oct’13

Nifty as on 15 Oct’13– 6089.05 (-23.65)    Bank Nifty as on 15 Oct’13– 10389.30 (-275.95)

We don’t know whether to prove us right or whether to prove us wrong, market is the best judge and price is supreme, and our readers and subscriber knows that we always try to remain genuine with our work.

When market is looking positive, you don’t bet on going short, if you are going then you must have big pocket, or else you are just speculating. We sincerely, believe that market has a potential to test 6229 levels. Now, see how market works, it opens gap up and remained positive for a while, and then start giving up the gains, in simple words we can call this move as pullback, and suddenly market starts plummeting sharply and still you don’t dare to go short (because, your underlying thought is- market has a potential to go high) and your prove wrong. Similar was the case with Bank Nifty.

Continue reading

Nifty and Bank Nifty Technical Analysis for 15 Oct’13

Nifty as on 14 Oct’13– 6112.70 (+16.50)    Bank Nifty as on 14 Oct’13– 10665.25 (+43.10)

Nifty and Bank Nifty both moved in a very tepid range through out the day, whereas CNX IT surged higher. Technically speaking, Nifty neither is confused at higher level, which is signified by small real candles on the chart, neither conclusively moving higher nor lower. So, for sure there will be huge round of volatility in days to come.

Betting for higher level is bit riskier at this place, we know that, but till we get any confirmation we should stick to our nifty view and look for long trades only. Dilemma is, may be upside is limited and risk to downside is equal, taking long call is tricky now.

Bank Nifty Trading Strategy

Our bank nifty view is optimistic and expecting at least 11+ levels. Let’s see.

Keep visiting Way2Profits, for unbiased Daily view on the Nifty and Bank Nifty.

Nifty & Bank Nifty Weekly Technical Outlook for 14th Oct, 2013

Nifty Daily Chart

Nifty Daily Chart

Bank Nifty Daily Chart

Bank Nifty Daily Chart

Tell me and I forget. Teach me and I remember. Involve me and I learn – Benjamin Franklin.

Every market participants, one or another day will agree with excellent quote of Benjamin Franklin. If I tell you, I am sure you are going to forget, if I teach, you will struggle to remember, but if you are involved with me than for sure you are going to learn and remember. As a trader or an analyst, you always have to accept supremacy of markets, the day when you start becoming stubborn with your view or start loving your trade, you begin journey which will drive you nowhere.

In last couple of weeks, what we observed is, even if you are right in your view, market is not allowing you to make profits out of it. Because, one day market moves in one direction and you build a position, immediately next day you find yourself in a dilemma, whether to hold this position or take a stop and get out of the market. Finally, as a small trader you cut your losses and get out, and next day you find that market open gap up and game is over. Your loss making position goes in profit, and you can’t dare to take fresh position seeing market already very high. This is tough time and we believe that it will not last, so cheer up.

Let’s take snap shot of last week, and understand what could be the next move of the market.

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PMS Status as on 11 Oct’ 2013

On 1 Oct’13 we have introduced Model Technical Analysis Portfolio. Under which we invested only Rs. 10000/- per scrip. Based on 11 Oct’13 Portfolio is up by almost 8%. Here we have not considered Brokerage Part, and also not taken Highs which particular stock has made, if we take highs particular stock has made than our portfolio is up by 13%.. Nevertheless, we take actual 8% return on our invested capital.

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Nifty and Bank Nifty Technical Analysis for 11 Oct’13

Nifty as on 10 Oct’13– 6020.95 (+13.50)    Bank Nifty as on 10 Oct’13– 10289.00 (-46.00)

Big players are puzzling with retail investors. It is really difficult to presume that where they are guiding the markets. In the last session, Nifty and Bank Nifty more or less remained static, as against expectation of some bullish momentum.

Now, based on pure technical’s small real body near resistance levels (bank nifty) creates skeptical atmosphere, something similar in Nifty also, small real body after smart gains of earlier session.  Price action creates doom, but if we see some past action than we add one more doubt to our understanding that, market is behaving in an irrational manner (may be our logics are irrational too), so you never know what could be next move.

Nifty Trading Strategy

Although, we are little skeptical but we stick to our guns and prefer to go long on dips. Please note, risk involvement is becoming higher now.

Bank Nifty Trading Strategy

In the Bank Nifty we like to take fresh bullish call only above 10650 only, until that time we may excuse Bank Nifty. Bye Bye…

Keep visiting Way2Profits, for unbiased Daily view on the Nifty and Bank Nifty.

Nifty and Bank Nifty Technical Analysis for 10 Oct’13

Nifty as on 09 Oct’13– 6007.45 (+79.05)    Bank Nifty as on 09 Oct’13– 10335.00 (+193.50)

Does this was anticipated by anyone?

Frankly, we anticipated that market will open gap down and trade with weak bias, but this smart engulfing move was nevertheless, was expected by us. But, let us admit that, we have one smart reader who is sharing his view with us has already informed us on 10.27 A.M that he is anticipating a rally. Let us put in his own words.

“I m expecting again 6021 . 😉 but yes if  my real-time studies supports it. 5996(future) seems to be the first target”  (For privacy purpose we are not sharing his name)

Hats Off To you Sir…

Nifty opened gap down, and started recovering quickly, same was the case with Bank Nifty. It seems that CNX IT which was the major driving factor for the market.  At this juncture market is moving in such a way that taking any call has become real tough.

Nifty Trading Strategy

As we mentioned in last article that Nifty is expected to move lower, and if it does not than it is one more trap.  Now, obviously market is heading towards 6142 to retest the last month high.

Bank Nifty Trading Strategy

Bank Nifty has few more hiccups to move higher, but looking at price action it seems that it will continue. Initial resistance we see at 10650, above which it sets tone for testing September month high of 11219. Keep watch on it.

Keep visiting Way2Profits, for unbiased Daily view on the Nifty and Bank Nifty.

Nifty and Bank Nifty Technical Analysis for 09 Oct’13

Nifty as on 08 Oct’13– 5928.40 (+22.25)    Bank Nifty as on 08 Oct’13– 10141.50 (+59.40)

Day when you are a winner, and still you are a loser. Market moved higher in line with our expectations, especially Bank Nifty witnessed significant rise, but unfortunately it was just gap up opening and subsequently reversal, total reversal.

Nifty made a high of 5981.70, broke the myths, broke the fractal high of 5950 and made force exit for shorts in the Nifty, thrown challenge to everyone and then started reversing quickly.

We were expecting Bank Nifty to test 10400 levels, it made a high of 10451.20 and we thought my goodness it will move to 10600, but our excitement proved short sighted in fact, we realized that it is real trap.

Nifty Trading Strategy

If, you are holding any long then it is better to exit for time being, there is a high probability that Nifty will move lower today (9 Oct), if it does not than it is one more trap.

Bank Nifty Trading Strategy

Practically, Bank Nifty does not give us any entry chance, but anyways if you are holding long than better to exit, and look for short trade.

Don’t stay put in Nifty and Bank Nifty together.

Keep visiting Way2Profits, for unbiased Daily view on the Nifty and Bank Nifty.