Wednesday, 7 October 2015

Tuesday, 6 October 2015

Will this rally fill the gaps?

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!

Mr. Market loves to play fool around with Bulls Bears and all analysts. This is what we stated last week and here he goes. Now Nifty is marching towards filing up the hard gap that we have witnessed in the month of August. What next?

Even before we discuss what next, I wanted to discuss something i think is more important to read before analyzing markets. The topic for discussion is "Looking at the chart at different angles (time frame) ". Someone asked me this over the weekend, what would be done if different time frames gives different outlook. A very good question, I said now you have started to learn analyzing markets. Why? Unless a person looks at the chart in different time frames he is not going to understand what is happening or rather understand what is going to happen in the coming sessions. Contradictions on the outlook looking at different time frames would be there and it has to be there. It is the duty of analysts to synthesis the chart in totality after considering all possible angles.

A minimum of 3 different angles needs to be looked into always, then needs to synthesis even before jumping into any conclusion. Let's say I look into monthly, weekly and daily chart. Consider it is like film. The Monthly chart gives me the main picture. The weekly chart is something like reading a plot or looking to the film review or ratings. And the daily chart is like a trailer. Obviously, can you conclude saying a film is good or bad purely based on looking at a trailer? No, similarly the case goes with film reviews or reading the plot. The plot might be more or less with most of the other films, however if we need to conclude saying a film is good or bad, we need to see the film completely. That is why a monthly chart acts as an important chart than in any other to understand in totality. Similarly the daily charts as this chart summarizes the entire day's event. It acts as an engine as to whether you want to look into a film or not.

So that was a little story. Now back to business. Nifty daily chart has turned neutral from negative. Intermediary (Weekly) chart still remains neutral while Monthly (Main Picture) chart still remains bearish. Nifty can march ahead in filling up the gaps even before turning down. With no signs of turning up in monthly chart, it would be hard to believe the correction that we are witnessing would be far from over.

Stay tuned am updating the charts. 

The key levels to watch out for on the upside are: 8225 (21st August Low) and 8359 (20th August Low) as these marks the start of hard gaps.    

Thursday, 1 October 2015

An in-depth analysis on Nifty

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!

Just now the DOW closed, closed with big gains however closed this quarter on a losing streak. As some of you know, I analyse and trade DOW more than any other market.

Let’s get into business. Am going to keep this post a bit longer. As we move towards a longer weekend, let us do the analysis bit deeper. Am going to take you through how a real analyst go through a chart with minute observations to arrive at some conclusion. It would be boring for some who doesn’t want to learn how to make money. It’s going to interesting for those who want to understand how a technical analyst observes a chart.  

Firstly, let us pull up the longer term picture of Nifty – the monthly chart.

Nifty – Monthly




We can easily identify the long term upward sloping trend-line still in place. This indicates Nifty has more room on the downside and currently we are heading towards 7400 mark if we have to believe this long term trend-line is to hold. If we drag in terms of time correction, we might see this 7400 mark moving towards 7450 or 7500, let us not speculate right now on where this correction could end up.

Nifty - Weekly



Now let us move to intermediate view on Nifty. Let’s pull the weekly chart. The zig zag zone that we believed till yesterday was a rectangle, you can find it in the posts below. Now observing this chart closely, we find it to be a perfect flag pattern in formation. RSI still has more room before turning down from in between 50 and 55 mark. Let us zoom this picture closely as to understand when will this zig zag zone comes to an end.

Nifty - Daily



Looking at the daily chart for a closer observation. Now this gives us few cues.
  1. we are heading towards an end of this zig zag zone. Once we hit around 8040, most likely today we might end up this zig zag moves. Even though we still have a probability where in Nifty move towards 7750 and hit back 8000 once again to stay in zig zag zone for quiet sometime, however the reason why I say we are ending up is by looking at the VIX chart which is posted at the end of this post.
  2. RSI has some more room on the upside wherein it can turn down in between 50-55 mark. We always consider 50-55 mark zone in RSI chart as a completion of the pullback rallies. This zone gives the main trend more inherent strength to push prices lower.

Now the question comes, if we are heading towards the close of zig zag zone; what next. Is it on the upside or downside. Can you see something different on the RSI chart? This holds the answer to our question. Let us dig the chart further down trying to answer our question.

Nifty - Hourly



Pulling up the hourly chart. We can now clearly see the zig zag zone (flag) on zoomed version. Now as we discussed earlier RSI on the daily chart hold the answer and this is why we have zoomed in. I have marked 4 points on the price chart. Three different lines have also been marked on the RSI indicator. Let us understand if there was any positive instances in the chart to indicate the next move up.
  1.       When RSI moved from 12 to 29 on the RSI chart, prices did actually moved lower indicating that this move do qualify for a positive divergence, however did not sustain the next few moves.
  2.       When RSI moved from 29 went all the way to 73 and moved back to 29, prices actually moved up; however it does not qualify for a positive divergence as RSI chart did not have divergence except for a double bottom.
  3.       When RSI moved from 29 to 31, prices again moved lower indicating another possible positive divergence which could pull back the nifty out of the zig zag zone, but fails to sustain the momentum (reading it along with MACD).

This shows though prices were hurrily moving up, it did not move on the basis of inherent strength of Bulls rather it moved up because Bears stayed away just to gain more strength to push prices lower once zig zag zone ends.

India - VIX



Finally let us pull India VIX (Volatility Index) chart. This will give us cues as in are we going to see an end to this zig zag zone in next two trading session or not. I have always observed, there is a negative correlation (most of the time) between price chart and VIX chart. So let us try to understand.

Looking at the chart we see an upward sloping line which acts as a trigger to plug in volatility in the markets. To be exact right now it hovers around VIX-18 and once this 18 mark is touched we might see another round of volatility creeping into the market, moving towards 40 mark which means (negative correlation) nifty moving towards 7400 mark.

Conclusion: Today watch out for Nifty @ 8040 + India VIX @ 18. If this combination happens either today or Monday, we might see the next round of selling coming in. Alternative view: If we close above 8050 or India VIX closes below 18, we might see the gap @ 8360 filled up before we head down. Why am I saying this alternate view is simple? We are in a correction zone and always Mr. Market loves to play fool around bulls and the bears.

Caveat: It’s only Mr. Market who is always right, not the Bulls, nor the Bears or the analysts. Mr. Market rewards only those who understands this and who follows him rather than trying to beat him.

Safe Investing! 

Wednesday, 30 September 2015

A qucik note

Technically speaking, governor's surprise announcement on the rate cut, hasn't changed the charts much. Nifty likely to continue zig zag moves in the session ahead. The rate cut would give us a positive impact on the longer run.
Safe Investing!

Monday, 28 September 2015

Are we still in the correction phase?

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!

Let us look at the Nifty chart first on a larger time frame before we proceed on in understanding what is going to happen in the next 2-3 days. Let us look at the main picture first.



Looking at the main picture, it is very clear that we are still in the final leg of this correction. This could take more time before we break out of this correction. The reason why it is taking more time in getting us out of the correction zone is very simple; this correction is actually an accumulation phase.

Looking very closely at the stocks of the broader market, one can understand one thing that people are accumulating good stocks on a daily basis taking leverage of the ongoing correction that we are witnessing. Though the broader markets may be moving down with each passing day, we find good stocks which could move up once the markets turn up are finding more accumulation rather than distribution, which we usually see in any correction phase. In short we find smart money moving from the not so fundamentally strong stocks to that of fundamentally strong stocks.



Looking at a minor time frame of Nifty chart, one thing is for sure that this zig zag move would continue further and this will take even more time than what we were even thinking of. Technically speaking on the technical parameters of this daily chart one could observer, as we have indicated earlier this month, the RSI really did turn down after hitting the 50 mark and on the MACD indicator it is giving a kind of convergence and it could turn down very soon starting a new sell off.

The immediate targets that I am looking out for on the Nifty, on the downside is 7540 and 7460. These are the two levels that we are keenly watching out on the downside. At the same time we are looking out for 8100 on the upside. This zig zag zone could probably drag Nifty further down in the next two sessions. Especially having Governor’s action round the corner, I strongly feel that nifty has more potential to move downwards.

Considering all these, I suggest rather than betting on the zig zag moves, to start accumulating stocks which are really really strong and wait patiently for the correction to wind up. Once we start moving on the upside, we could gain wealth many times over investment. Once the correction ends, the target that I am looking for on nifty (on the upside) is around 14,000. This means that real good stocks could fetch you 5-6 times of what you have invested over the next couple of years. So be patient, start accumulating very good stocks rather than falling prey to this zig zag move of Nifty. Stay invested, be patient and enjoy the fruits of the markets.

The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Trending on the downside with immediate supports at 7540 and 7460.

Short term Trend: Trending Down. The trend will not change until we close above 8100, which means 8100 would act as SL for those who are short in Nifty.


Thank you!

Regular updates coming up from tonight

Dear All,

It has been a testing month for me and dalal times as a team. We at dalal times face challenges that any other startup would face. This has made me not overlooking the blog. I understand the faith and trust that you have kept on me and my team. I sincerely apologies for the non updation of this blog and not answering the queries. I will resume blogging from tonight and try to answer all pending queries by tomorrow.

Once again a sincere apologies.

Regards,
Praveen Pathiyil 

Tuesday, 8 September 2015

Nifty up 130 points, is correction over?

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!

It has been a great day for the bulls yesterday, with no bears hardly found on the trading floor. The question is, 'is this the start of the next leg up?' This can only be answered by looking into the major time frame chart. Let us pull up the Nifty monthly chart to understand where we stand.



Looking at the chart, it is clear that the up move of 130 points that we saw yesterday hardly had impacted the ongoing correction. The chart shows more downside to come in coming weeks. From my experience my observation on RSI and its correlation with correction: "for a healthy new leg up, the correction has to end up when RSI settles down in between the range of 50 & 45. I have marked this in the above chart, and we can clearly see that there is still room for the downside. Also look at the MACD, there isn't any signs of bullishness yet. Bollinger bands are contracting, and by the time we end this correction phase, we will see a tighter band, making prices to hardly move within a congestion zone. Narrowing it down, Correction isn't over yet.

Now let us also check the daily chart of Nifty to understand how yesterday's ‘move up’ has impacted.



A little impact could be found. There isn't any drastic change that we could find. Look at the downward sloping trend line, Nifty hasn't answered to the resistance created by the gap down that we witnessed last month. RSI hovering around the oversold zone, yes this could be taken up as positive or negative and MACD still negative. Even if we find some follow up swings in todays trading session, unless we see some drastic reflection on the chart, I think this correction is still in place.

The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Trending Down, now the trend is in place.

Short term Trend: Trending Down. The trend will not change until we close above 8210, which means 8210 would act as SL for those who are short in Nifty.


Safe Investing!

Monday, 7 September 2015

Will this correction end at 7400?

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!



I haven't been updating this blog for past few days, the reason was simple, I haven't seen something new in Nifty's chart. I am still holding the view that Nifty has to correct till 7400. 7460 and 7400 are two crucial support levels that I see in Nifty chart. Now the question for the day is: will 7400 hold? 

I am afraid to tell, looking at the chart, I see more correction to take place in Nifty. The ugly part is:

a) the next phase of correction below 7460 would be a dragging one

b) the time taken to move Nifty out this correction zone would be more than what we could anticipate.

Though these are my anticipations based on my experience, I could go wrong, and I have gone wrong many a times. The only person who can answer all our questions is Mr. Market. I am successful because Mr. Market gives us cues and I used to grab it in the right sense. As and when I see any changes in Nifty's chart, will keep you updated.

The good things are:

a) Bear's aren't participating (with same enthusiasm as the start) in the downfall for the past three day's indicating Bear's too do not have conviction that the correction would last longer. But this a cue that I get, Mr. Market always like to test the patience of both Bulls and Bears.

b) many good fundamentally and technically strong stocks are much cheaper than two month back, it's an opportunity to grab and make much faster money.

The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Trending Down, now the trend is in place.

Short term Trend: Trending Down. The trend will not change until we close above 8240, which means 8240 would act as SL for those who are short in Nifty.

Tomorrow will update Bank Nifty, if there isn't any major change in Nifty's Chart.


Safe Investing!

Thursday, 3 September 2015

Ask Pathiyil! My views on Tata Steel


Good Evening!

We have received a stock query from Mr. Hukumat Nathwani. He wants to know what are the prospects of Tata Steel?


Here is my view on Tata Steel.

Fundamentally and technically Tata Steel is looking weak. This is one of the stocks which I used to track very closely till a year back. I would like to highlight one important factor here, to my experience I have seen technical studies turn first followed by the fundamental factors; this is one of the reason why I focus more on technicals and not purely going by fundamentals. There is always a difference of opinion between technical analysts and fundamentalist on which one is supreme school of thought, however I believe to earn money from markets you should have through understanding of both the sciences.

Let’s get back to Tata Steel. During the month of May, 2014 when this stock broke out on the positive side, I considered it to be the best buy. However the beauty of technicals is this, it can only initiate a trend but if it has to be a good bet, it should be backed up by changes in fundamentals of the company. Tata Steel’s fundamentals failed to give a better picture and hence the stock turned bad during the month of December 2014. Now if you look at it, both fundamentals and technicals do not support to buy or hold on to this stock.



Technically, this stock might see a dead cat bounce towards 333, however if this happens this should be taken as an opportunity to exit. The reason is simple, if the technicals and fundamentals has to change for this company, it would take a minimum of 2 years and that is also not a definite thing to happen. Since we are in a multi month bull run, we have much better stocks to make money from the market.

On the pipeline for askpathiyil, we have a query on FT, IDFC and a list of portfolio. I will be answering by this weekend. If you have any stock query please write to me at askpathiyil@gmail.com


Thank you. Happy Learning!

Nifty's fall in place.

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!



Am going to keep this short. Nifty’s price action suggests little more downside is on its way. However I was wrong in anticipating it to be a free fall towards 7400. Rather than a free fall we witness a zig zag fall in place for nifty. This shows how strong our ongoing multi month bull run is. 7400 is going to stay, and it would be interesting to watch out for how Bulls behave once hitting this level.

The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Trending Down. Looking at the trending pattern on the intermediate time scale, am not fully convinced the way it unfolds. Any positive move above yesterday’s high at 8044 will change the pattern back to neutral.

Short term Trend: Trending Down. The trend will not change until we close above 8200, which means 8200 would act as SL for those who are short in Nifty.

Stay tuned for tonight, as I answer some stock related questions that we have received for the section “ask Pathiyil”


Safe Investing!

Tuesday, 1 September 2015

Ask Pathiyil


Ask Pathiyil

We understand when it comes to investing in stock markets, there are always many questions in your mind to be answered.

When should I invest?
Which stock to buy?
When to exit?
What is the future prospects of a company?
and so on....

With these question in your mind, we have created this section exclusive for you. We are here to help you with answers for your questions. Use the contact me form on your left panel to ask question or write to us your question at askpathiyil@gmail.com

We would be happy to help you and share our wisdom.


Informed Investing!

Nifty 7400! Here we come....

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.


Good Morning!


What a start to the month of September. As expected Nifty has started to move towards 7400. We are looking for a firm support at the level of 7460. The question remains, is this good enough to hold for the multi month Bull Run on the larger time frame? With yesterday’s price action, the good news for the bears is the intermediate trend has turned negative. This will add more pressure for the last standing bulls (short term investors). Meanwhile, the psychology parameter which was bullish till Monday have also turned and it indicates a neutral view. If bears manage to close Nifty lower today, we could see fear creeping into the markets.

Technically Speaking, the inherent strength (marked by RSI) on all different time scales (daily, weekly and monthly) has more room to push prices on the downside. Looking at the RSI indicator on the monthly chart, I think the correction would end probably when RSI hits in between 45-50. I have seen this many a times that the correction on larger time scale ends exactly between these levels on RSI indicator. With expanding channels on the downside, which indicates more downside on the cards.

In short, hold on to the cash and as soon as our correction is over, we will have opportunities to enter into solid stocks which would fetch better returns than Nifty.

The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: The trend which was neutral till day before yesterday has turned down (negative) with yesterday’s fall. However, intermediate trend on Nifty will not hold for the day as it needs one more day of negative close.

Short term Trend: Trending Down. The trend will not change until we close above 8240, which means 8240 would act as SL for those who are short in Nifty.

Safe Investing!

Monday, 31 August 2015

Nifty to resume downside move towards 7400 this week

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.


Good Morning!


Having broken all major support (8240 & 8120) last week and closed below them, Nifty likely to continue its downward journey towards 7400 this week. If you look closely the Nifty chart at different time frames one thing is evident, that volumes spike up at every fall, indicating how the bears are utilizing the opportunity to build short with every short lived raise. 7940 would act as a minor support for the day, however having this level broken last week, we can see this level breaking at ease by the bears. In short, especially the last 3 days of this week would be controlled mainly by the bears. 

Technically speaking, on the daily chart of Nifty I am looking for a move in RSI towards 50 and MACD to converge a little more. These would give more strength to the bears to push the Nifty harder towards 7400 in the second half of this week. Stay calm as once this turbulent wave is over, we are going to see a major upside move.

The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Not trending.

Short term Trend: Trending Down. The trend will not change until we close above 8240, which means 8240 would act as SL for those who are short in Nifty.

Safe Investing!

Friday, 28 August 2015

Nifty and Bank Nifty's Surge!

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!

A positive move yesterday and possibly today do not change our outlook in Nifty. If you think I am a bear, you are wrong. I am not a bull nor a bear, and keep changing roles as per the market trend. I believe staying one sided in market won’t lead you anywhere. Today is the start of a new series and we are also going to start our Bank Nifty analysis from today. We will also introduce stocks from Monday.


First thing first. Let’s look at Nifty’s chart and understand what it holds. Nifty has broken down with a gap down, unless Nifty manages to close above the start of the gap down i.e. close above 8360, we will hold on to our intermediate view as negative on Nifty. The volumes data for yesterdays could mislead as it was expiry. It would be interesting to know how Nifty and volume data reacts to start of new series. The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Not trending.

Short term Trend: Trending Down. The trend will not change until we close above 8240, which means 8240 would act as SL for those who are short in Nifty.

Take away: Short term trend in Nifty still points downside, and hence we are sticking with the negative view on Nifty. Have a close watch on 8115 as the close above this in today’s trade could (not necessarily) change the short term view from negative to neutral.

Bank Nifty: Likewise in Nifty, Bank Nifty too is in a correction and we haven’t changed our long term outlook to bearish. Bank Nifty is moving towards 15450 on the downside.


The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 13800 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Not trending.

Short term Trend: Trending Down. The short term trend in Bank Nifty is stronger than the broader index Nifty. As long as Bank Nifty trades below 18220, we will not change our short term negative outlook.

Safe Investing!

Thursday, 27 August 2015

Crucial expiry day

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.


Good Morning!


It’s going to be a crucial expiry for Nifty. While most of the roll overs have been done, it would be interesting to understand how smart money would stack up positions for the next series. It’s always the trend that will guide us in understanding what is most likely to happen in the coming days/ weeks/ months. So am going to make this a point to highlight you what the trends are on every blog post that been updated.

For Nifty the trends are:

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Not trending.

Short term Trend: Trending Down. The trend will not change until we close above 8240, which means 8240 would act as SL for those who are short in Nifty.

Going to include bank nifty from tomorrow (new series) and stocks from September 1. So stay tuned as I expand my technical views beyond nifty.

Safe Investing!

Wednesday, 26 August 2015

Nifty will move towards 7400

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.


Good Morning!


The correction isn’t over. Yesterday’s positive closing is just a relief rally that we witnessed and not the start of the next leg up. We are fast moving towards 7400 on the downside. Having expiry round the corner, we believe the haphazard move in markets to continue.

Once the correction is done, we are going to have wonderful opportunity to enter into sound stocks which could fetch 3 times or 4 times the present value. Stay patient until we are done with turbulent wave.

Safe Investing!

Tuesday, 25 August 2015

More correction is due in Nifty

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.


Good Morning!


What a day it was! A Monday to forget, unfortunately not. As I said last week, the unconvinced up move 7940 has eventually faded out and we have started with new (probably) last leg of this correction phase. This is a correction only and looking at the nifty chart in different time frames, it is clear that we have more points to go down before we conclude saying the correction is over. What are we looking for, on the downside? This is how most likely the nifty is going to move in the coming weeks.

A free fall until 7430

An up move (dead cat bounce) all the way till 7940

A zig zag move towards 7430 – 7250 – 7090 – 6940 – 6810

Remember these zig zag moves, not necessarily need to be met: the reason is we are in the first correction of a multi month bull rally. Averaging or re-entering could start from any of these zig zag levels. Of course yes, I will be updating as it unfolds, however as I received many calls yesterday asking how far it can plunge am updating these possible levels on Nifty. Can you see bottom line at the top? Am going to update it until we are done with the correction. Hold up your cash to re-enter markets or average stocks once correction is done.

A small reminder: Kindly do not stack up positions based on margins, it might damper your entire capital. Will let you know when the time to take leverage is ready.

Safe Investing!

Note: There was a problem with blog updation for the previous weekend and yesterday. Hope this has resolved and will start updating on stock queries that I received starting 26th. If you have any questions please use the contact form placed on the left panel of this blog.

Friday, 21 August 2015

Closing comments on Nifty

An impressive come back!

It has been an impressive come back by the bulls especially during the last one hour of today's trade. However two important questions remains unanswered. 1) Is this come back by the bulls enough for the gap down and break down of congestion zone created by bears this morning? and 2) Will bulls manage to close above 8322 today? Yes, I think today's closing is more important to chart out the next phase of move in nifty. Eagerly awaiting close and looking at the key level 8322.


A quick note for 21/08/2015

Good Morning!

Am going to keep this short, as there is no major change in the daily chart of Nifty. Still struck within the congestion zone, Nifty might break out of the zone at the earliest. On the backdrop of global melt down the previous night, this seems more likely as this could be the trigger to get nifty out of this zone. Once the break down is confirmed, we will start discussing possible levels in Nifty. Keep a close watch on 8120 as this could be first likely target on downside. Do check back this weekend as we are going to start classroom on technical analysis.



Bears are more likely to overpower if we see a negative close today. Am going to do a quick wrap up at 3.15p.m. today, in order to help you decide to stay long or short in the market.


Happy trading!

Thursday, 20 August 2015

Nifty Outlook for 20/08/2015

Good Morning!

Working with different time frames of a chart provides much better clarity in understanding what could be the most likely next move in it. A good analyst never arrives at a conclusion just by looking at a chart in isolation. Starting today we are going to discuss what could unfold in Nifty on day to day basis. Even though I will not be populating any other Nifty time frame chart except daily chart, I would like to disclose that the forecasts that you would read in this blog in Nifty or for that matter any other stocks is arrived after looking into different time frames.

I work with monthly, weekly and daily charts. I used to look at hourly and 15 min chart, however I have stopped using it on regular basis as time frames above daily chart works better for me in terms of forecasting. I invest in markets and do not trade now a days and hence I have also restricted looking at charts when markets are live. This is how this blog is going to shape up from today, daily outlook from Tuesdays till Fridays; intermediate outlook on Mondays and occasionally major outlook as and when things unfold. Apart from all these knowledge sharing would also be focused, as I believe everyone who is reading this blog should not only follow me on markets rather learn and develop one’s own style in forecasting markets. Knowledge sessions would be on weekends.

Nifty Daily Outlook



Looking at the chart, and focusing more on the up move that happened from 7940, clearly shows how Nifty has held up in a tight range. An unconvincing 700 points move on the upside and held back in a tight range. This chart shows a different picture to that of the other charts that we were discussing earlier this week. If you were look at the exact points in this Nifty chart, you could find one thing in common, Nifty has been making lower highs and higher lows; a perfect example for non-trending phase of market.

The good news is we are going to move out of this range very soon. Once we break this congestion zone either on the upside or downside, we are going to see another round of 500-600 points uninterrupted. A two days consecutive close below 8380 marks break down of this zone and a two day consecutive close above 8530 marks a broke out of this zone on upside. It’s always risky to trade in a tight range but a good jobber loves this kind of market situation as he has multiple entry exit opportunities.
Will keep you posted on daily outlook with levels as and when things starts to unfold in Nifty.


Happy trading!

Tuesday, 18 August 2015

Nifty's correction is in place

Good Morning!

Most of you who are following this blog would love to know the answer today for the question: Is the correction that we are witnessing for the past six months is over? We will definitely answer this by end of this post. However, to start off with, I think one must have a better clarity on correction and counter trend. If you were to watch a business channel and listen to analyst’s appearing in different shows, tend to give different numbers and differ in opinion. Some say, it’s a correction, some others would opinion that the trend has changed and few others would say “adopt a wait and watch policy as there is no trend”. It might be confusing for a person who do not understand technical’s, and might be in a dilemma as to whose view is correct.

I would say it’s the perception that differs among analysts. With more than 10,000 indicators, numerous time frames which makes the chartist to look at the same chart, different perception emerges. If you were to observe analysts when the markets are moving one sided, they hardly differ in opinion. The difference of opinion comes only at a time when we see a correction or a counter trend is in place. And understanding counter moves becomes very important. It’s because it can mean only one of the two options, either 1) it can be a correction wherein you get an opportunity to re-enter or average; or 2) it could be a change in trend which gives you an opportunity to exit the current position and build new position on the opposite side.


Understanding counter moves are extremely important and am going to make this easier by posting a lesson on it this weekend. For the time being, let’s shift back to Nifty in action.

Nifty’s Intermediate Outlook:


Looking at the move from 7940 in Nifty weekly chart, also looking at the monthly chart and the daily chart, it’s clear that the correction that we have been seeing in Nifty for the past six months is yet to complete. Looking at the volumes especially delivery volumes of the underlying stocks of Nifty, it’s suggesting the correction is not over. We usually see a spurt up in volumes when the correction phase is done signalling smart money re-enters or averages the current holdings. Also technically speaking, the indicators RSI and MACD on the weekly chart still has more room to go downside. How far downside? 8120 is one key number which am eyeing for the current moment, wherein I feel the Nifty’s congestion zone begins.

Starting Thursday, we are starting with the daily outlook of Nifty. Watch out for Nifty’s action on day to day basis.

Happy Investing!