After fast and furious five days we have got a bearish reversal pattern after a long time i.e., Bearish engulfing on Nifty. Market have been one way since last week but now it seems we may get some breaks on the rally. Confirmation of bearish engulfing could be only if we trade below todays low tomorrow or day two. Though my second target 8265 still active, but before reaching there we may get some slide to 7950. Indicators on daily charts are overbought so the slide could be as furious as rally and safe traders should avoid shorts and rather raise their trailing stop loss from 7810 to 7950 on longs recommended above 7700. Stock specific movement should remain positive on the D-street and traders must trade stocks rather than indices. As overall outlook is positive on indices, safe traders must not trade against trend and wait for a long entry below or just hold on longs with a trailing sl. On the upside targets remain 8265 and than 8400. Coming two days are crucial as tomorrow our markets would react to GDP 7.9% and on 2nd June we have OPEC Meet. So stay hedged with 7950 PE June.
Today i just felt i was watching highlights of RCB vs GL where Virat and AB De villiers scored incredible 248 in 15 overs as exactly same we scored 300+ points on Nifty in 2 sessions which was just so fascinating. 7700 was surely my support but frankly speaking i also didnt expect such a rapid recovery in just 2 sessions. But coincidentally it has exactly closed near to my mentioned target 8100 yesterday. Though we were just short of 17 odd points to my target but we can say we almost reached there. Last two sessions rally have surely raised chances of profit booking in coming week but medium term traders should use this opportunity as adding some stocks to portfolio for activated target of 8450 as i mentioned yesterday. But two speed breaker targets on the way could be 8100/8265 while stop loss is 200 day average at 7810. So happy trading days ahead but stay hedged with 7700 PE June Nifty.
Its often difficult to find a perfect pattern on stock charts for a trading view but today i just noticed something which is just like getting ‘Double scoop of icecream’ in scorching heat i.e., Double Inverted H&S on same stock and on same time frame but with Higher targets on Tata Chemicals. Though i am late in intimating you guys of ‘light blue inverted H&S’ but still we can trade for its target combined with larger ‘Pink inverted H&S’ which has been confirmed today with volumes. Looking at indicators on daily charts we are in overbought zone bought they have given internal positive crossover giving confidence for achieving atleast inverted H&S target in near term which could be tomorrow if they post good numbers. So trading strategy for short term traders is going long on Tata Chem tomorrow at first trade with tgts of 458/530 and stop loss at 390.
Vacuum cleaner has sucked out all Bears in a day from the Nifty charts. As i mentioned yesterday, 7772 was the hurdle but we opened way above the hurdle and confirmed short term rally with a close above number of resistances. Technically, now the gates have reopened for upside target of 8100 in june expiry but alot would be dependent on OPEC meet and Bank policy which are on 2 June and 7th June respectively. The last two weeks correction could be attributed to extended consolidation wave patterns on daily charts of Nifty. Today we have got close above 200 day average which was around 7810. Two more close above 200 day average and we are all set for medium term target of 8450. Now Supports on downside could be at 7810 and 7690 for next expiry. Overall stay Bullish on stocks and indices for june expiry but with strict stop loss.
Since last few days, there was nothing to write about on Nifty as we were witnessing a Mary-go-round for traders around 200 day average which was flying around 7792-7810 but today finally i have spotted something on daily charts. Nifty opened flat today but closed way above 0 mark leaving a Green candle but the candle has resisted to line (upper red line) connecting recent higher highs which makes it a bearish point. But we cant surely be going short yet on nifty because on downside we have got a support line (marked red too) which was a resistance line of channel which was intact since the life high last year. Indicators are flat on Daily as well as Weekly chart frame and so we cant get any clear way for either bears or bulls out of their position. Coming to candlesticks, there too we are not having any clear pattern for the clue ahead. So what i understand now is that we have entered a “Vacuumed Area” between the two trend lines. Why i termed it as a Vacuumed area? because those traders or analysts who would be following trend line below at 7670 would create a demand zone around the same level and on other side who would be following trend line above at 7772 would create supply zone around that and third category guys like me who would follow both would try to Sell at above trend line and Buy at below trend line. So lets c who wins the battle and Can Nifty get out of this Vacuum Cleaner soon ? Until Nifty closes out side this Vacuum zone we wont take any call on index.
As it is said that patience’s pays off so has my trading view on Spice Jet. On 8th April 2016 in my post (Link:Spice up your profits with Spice Jet) i recommended trading on a ‘inverted H&S’ pattern on Spicejet which was trading around 71 and my target was 80 which has been achieved safely. In almost 40 days we got 12.5% return on simple patterns, so have patience and have faith on simple patterns. Will surely give you more such recommendations as i get noticed. Please find attached graph of the stock which clearly marks out the pattern and target achieved.
It had been nightmare for BTST traders as Nifty opened gap down and didnt gave any chance for BTST players to exit in profits but positional traders shouldn’t worry much. As i said yesterday that we might get a dip today and best buy would be in the range of 7840-7870 and we have closed exactly at the trigger point on upside. Though looking at Daily chart of Nifty, many of novice technical analyst or traders would say that we have got “Evening star” pattern but IT’S NOT! One of the rule for the pattern is a Long red third candle which in this case is green so a reversal on this pattern cannot be a valid one. Secondly, today again we got low exactly at 200 day SMA which is at 7811. Thirdly, if we calculate fibonacci support level of the rally 7772-7940, it comes exactly at 7811 where we pinched a low today. So all the factors except indicators are still showing hopes of upside. Though my ultimate target remains 8055 and stop loss at 7740 but a BTST trade can take call with a tgt of 7970 while stop loss could be 7810 on Nifty spot level. Still stay hedged and take decision as per your risk appetite.
Nifty as expected gave a master blaster start above 7900 and pinched new high which is at 7940 but than we closed nervously around 7890 with a gravestone doji on daily charts. After a last 30 mins furious sell-off on index, traders on D-street have started targeting nifty 7500? I mean how insane is that ? a minor knee-jerk reaction cannot shatter upside targets which were activated yesterday after a good move on daily charts. I am sure you all would ask me that “gravestone doji” is clear sign of weakness but guys remember there could be rare exceptions to it and this could be one of it. Why? Because today’s high 7940 was not target or resistance by any methods of projections or wave’s as per me prior to this day. Secondly, weekly charts are yet not showing or confirming any signs of weakness. So i am not sounding over confidence but just trusting my prior analysis and as it said u shouldnt consider a complete reversal unless target or stop loss is not triggered. And if i try to consider a fibonacci correction of last small rally than best buy tomorrow could be in the range of 7840-7870 for a btst call so buy on dips. While my activated target is 8055 and my trailing Stop loss should be 7740 you should always be hedged and take decision at your risk
After a volatile profit booking in last two weeks, we could now kick start a rally tomorrow on Nifty index. As i had been mentioning 7777 as crucial level, today we did breach it for few seconds but we have maintained it as support on closing basis and still remains further. On weekly chart that level is now trend line support of previous downside channel. Now talking about some chart patterns, as of now it seems that we completed 2 cd Wave correction of flat today. Now we if we cross 7909 which was high of wave b in 2nd wave then a 200 points rally could be confirmed from there to 8100. Even the indicators have crossed over positive for a confirmation to our view but its always safe to be hedged. 7700 PE should be bought to hegde by long recommendation given in previous two post which has targets of 8055. Lets hope we get confirmation tomorrow.
Finally Nifty has showed path to my destination 8265 by achieving my first tgt of 7909 which was even 50 WSMA resistance. Though indicators on daily charts are on overbought zone but they have given Bullish Crossover internally to signal short term positive momentum. Todays move would be further fueled with CPI and IIP announced today. Markets have been also in confidence because of good earnings posted by front line stocks. Technically, as per Elliot wave calculations 8055 should be minimum we to be achieved in this expiry. Weekly chart indicators are showing good momentum for the upside and its trading above downward sloping channel of last one year. To summarize, Nifty is currently “King of Good times”. Strategy would now raise SL to 7780 from 7690 and target remains same at 8055