Monthly Archives: January 2014

#199 Nifty Update: Hanging on the verge of Peak

On our #195 Nifty update we recommended tgt of 6070 on Nifty Short which has been achieved today and i guess you guys would have atleast booked some profit. Now future path on nifty looks lil bit dicey after carefully studying banknifty chart. Ofcourse Weekly charts and Monthly charts are looking still bearish but we are smelling some internal pull back from the daily charts of nifty. Firstly, As you all could notice on the chart Nifty is travelling in downside channel and today it has just managed to cling on the peak of support line in Channel. Technically tomorrow is important day for Nifty analyst as closed would be important for weekly candle as well as monthly candle. Secondly, Considering only todays candle it is a hammer or you can say a Dragon fly which is a sign of a reversal for a short term. And Finally, if tomorrows opening is little positive above 6082 than we could see a Morning star reversal after tomorrows close. Yesterday, FED tappered more $10 Billion  from its bond buying programme which helped markets to crash today morning but fundamentally you think its good news for Economy as tappering is sign that FED is smelling a recovery in its Economy. Our results have on other side been hawkish and unable to decide the state of economy. Our markets are majorily for National Election rather than Economic recovery. So coming back to Index for near term we are expecting a short recovery of 150-200 Points.
Our recommendation: Book 100% profit on our short Call near our 1st tgt 6070 and we recommend to go long near to same level with tgts of 6125/6170/6230 SL:5998

#6 BankNifty Update: Ranking your profits high on the Low

You might be thinking that what does my headline mean today??? I meant to say that even BankNifty made a near term low today, i am sure you guys are ranking high on profits as you would have made almost 1100 points on our short call on Banknifty. On 15th December we recommended to short BankNifty near to 11366 and our tgt was 10260 which has been achieved comfortably. A simple look on chart could attract you guys to steep fall in last 1.5 months with small recovery. But Now as per elliot wave we expect a small pull on bankNifty which would be intermediate move and not the larger wave.  The Chart mentioned is weekly chart and it has breached 200 Weekly average which was acting as strong support. But we expect it to resume support next week soon. Banking sector bulls have seen some tough beating and now its time for them to give a fight back.

Our recommendation: We recommend to go long on BankNifty  (CMP:10153) with tgts 10390/10580/10780/10990 SL:9980

#5 BankNifty Update: Bank's Tank's

On 15th Dec we recommended to Short BankNifty on our blog at 11366 with tgts of 10720 and 10260 of which we have achieved 1st tgt easily last week. BankNifty made low at 10333 which was just 70 points away from our 2cd tgt. Anyways No worries we will still get that tgt but might take some time. Today we had third monetary policy by Mr.Rajan and street expected no change but truely speaking i did expect a hike in rate. I am not lieing but who all are in my touch personally could recollect that i myt have conveyed this gut feeling. Inflation has did cool off in last number but that major change was becoz have decreasing in Onion price. On other sign IIP are getting worst which made me pretty sure that RBI will rake hike. Though i didnt expect hike in reverse repo. Now coming to technicals BankNifty is still showing weakness sign on Weekly chart but a short covering is expected on Daily chart. As you could notice weekly chart in above graph, it clear shows off strong support at 200 Weekly average last week. Secondly now elliot wave suggests that we might see a pull back to 10988 but thats just a big MIGHT. 10988 is also a trendline resistance and 100 weekly Moving average which makes that point more stronger resistance on weekly chart. I hope you guys have booked atleast 50% profit on our 1st tgt 10720, if not do it right away.

Our Recommendation: HOLD rest 50% short on bankNifty with trailing at Cost price 11366 and risk taker can again short near 10988 with the same SL. and near tgt is intact at 10260 

*all levels mentioned are of bankNifty index and Not future and rely on recommendation at your risk.

#198 Nifty Update: Evening Star on Index

Earning seasons have been lil disappointing till todays market session but than Reliance industries have presented a better than estimate results after market. TCS on other hand gave a better than expected profit but it was not able to meet its dollar guidance which banged stock of the radar today by traders. HDFCBANK and ITC presented results in-line with estimates so not much volatility on that counters. But on Nifty daily chart today i just noticed a kind of “Evening Star” pattern on daily chart which is complimenting our weekly bearish call since 13th Dec. Technically nifty chart has been biased towards bearish trend in ratio of 70:30 against bullish. Nifty was comfortably trading above 5 SMA since last 4 trading session this week before today but now it has closed below the same on 5th day which may be a sign of some weakness from average. Now monday’s opening would be important for our existing short call. Next week strong support level is 6168 while resistance is at 6312. So if you guys have missed trade this week than take a short call if nifty opens up in positive range.

Our strategy: We are intact with our SELL call on NIFTY which we initiated in last 2 posts. 

#197 Nifty Update: Critical Range 6164-6328

All of sudden was drawing trend-lines on weekly nifty chart and came across two lines which are guiding nifty’s road. After market Inflation was announced which has eased with higher margin compared with last month but i guess last hour move of Nifty cld have discounted that. Technically indicators have all of sudden spurt up on daily chart but not much change on weekly chart. We would ask traders to keep 6164-6328 range in mind for this week as they are the guiding lines as you all could see in the chart

Our Strategy: We are intact with our SELL call on NIFTY where safe traders SL at 6358 and Risk traders at 6450

#196 Nifty Update: TICKET CONFIRMED

Bears have got a confirmed ticket to 5700-5900 which they booked last week wtih “Bearish Engulfing” travellers co. As you all could see “Rectangle” marked on top which suggest a perfect Bearish engulfing which is even confirmed with a lower low candle last week. As i said now bears have confirmed ticket but there is always 1% chance that bears wont travel i.e., there is always a chance of other side on markets. Infosys came up with better than estimate results and also a good guidance but it couldnt hold Nifty on higher levels. IIP shrank to 2.1% in November with 6th consecutive fall. So one thing is clear that our industrial economy hasnt picked up as markets expected and we may see some disappointing results this season. Technically, indiactors have turned weak on weekly chart joining bears to downfall. Since last 4 trading session nifty has been trading below 50 SMA which is at 6193. It has been acting as strong closing resistance level for the index. Long term investors start arranging cash to buy equity soon in coming months

Our Strategy: We are intact with our tgts and Short call as per our last NIFTY update.

#6 Gold Update: "Old is Gold"

Trading gold or to say investing gold had been the oldest idea and its back for short term. Equity has been showing sign of weakness in near term which was the first sign that made me look at gold chart. And surprisingly it is supporting the inverse rule with Nifty or to say equity in that manner. Attached graph is weekly chart of Gold and we could notice that 50 Weekly Average has crossed 100 to trigger a short call but indicators are suggesting a small pull back on gold which could be upto 29470-30400. This pull back will be pure technical and we expect it to be a fast one. Short term traders can sure trade long but for safe traders we recommend to go short on the resistance levels as menitoned above. As i have circled area on the chart it is to show you how gold is reversing around at 28280 in this marked period. Since last three weeks it has taken support there and bounced back. Daily chart has also shown some sign of pull back. But on other side 30460 is strong resistance on Monthly chart which would be breached.

Our Strategy: We recommend to go long with sl of 28300 tgts 29470/30400

Note:* We might have recommended this strategy to our client and we dont have any personal position

#195 Nifty update: "Double Toppings on Nifty"

We all get excited when we get double toppings on Icecream or Pizza but i guess after todays close bulls wont be happy with the ”Double topping of Bearish Engulfing pattern on Nifty’s Weekly chart”. On other side Bears would be happy of the toppings. Now time will say who can digest this double topping..Bears or Bulls…Volumes on Nifty had dried up as Americans where on Christmas and New year celebration holiday. Yesterday we saw a basket selling and people had two reasons in mind 1) Rumors that Manmohan Singh would resign today (but he didnt) 2) People in Europe and America were booking profit after High NAV recorded on Financial Book Closure on 31st dec. Whichever reason you choose technical had indicated on 13th Dec Weekly closing and we did post on Blog to be short. Bond Purchase has decreased by $10 Billion/month which could also squeeze out  some liquidity gradually from market over some time. High Inflation is persisting in India which could trigger a rate hike in next RBI policy. On other hand Auto Sales have decreased for major companies in Dec which may be due to Inauspicious days as per Hindu belief. IIP are still pitched at lower levels which is not cheering for our economy. Earning season is about to commence and we expect intact growth and not much of flourished profits as our rupee had been stable around 62 which wouldnt have bought much profits for IT and Pharma sector which are dependent on foreign income. So we expect some profit bookings by short term traders on Nifty but we cant measure the extent of profit booking on downside i.e., it could be deep or even consolidation. Only good thing going around in Indian economy is FDI reforms. FDI in railway could be a surprise for markets and good for Indian railways. Parliament even approved some of the investment such as TESCO and vodafone 100% hike in Indian unit. Linking some inter market analysis, Gold chart is showing some bullishness which is a sign of downside in equity though not directly correlated in short term but it could trigger some bearishness on stocks. Coming to technicals, if we consider a bull wave to end at 6415, than we can see some extreme downside as we mentioned on last nifty update post. But for short term we have again got a chance to Sell nifty with some stop loss. Nifty is taking strong support at 50 SMA at 6193 on daily chart. RSI has turned negative. So now it seems Daily chart is also supporting negative biasness seen at weekly chart since 13th dec.

Long Term Traders Strategy: We are intact with Short call initiated on last post with tgt of 5970/5750 and SL 6415

Short term Traders straegy: We recommend to go Short (CMP 6211) tgts 6072/5970/5895 SL: 6360

*Note all levels on nifty are Cash levels and trade at ur risk with careful study. We might have recommended this strategy to our clients and we dont have any personal position. My analysis is biased to technical analysis.