Monthly Archives: January 2017

Traders Pocket may get more Fatty!

Traders got their pockets Fattier this expiry after a long time but this MAY NOT be end. Budget to decided whether “Traders pocket would get more Fatty”! .  I did expect Nifty to touch this high two weeks back at my post: “Bottom’s up for Short term trader” where tgts were 8445/8563/8712 and we are just left with the last one. Such a fast rally now could even activate more high levels if the budget comes in favor of common men.

26_1_17

Now Lets talk Technically! As had been mentioning since last few post on Nifty, 8720 could be crucial level on weekly basis. That should be stop loss for short term traders who might have carried forward shorts. But for long traders party would continue above 8720. Indicators have totally turned positive but as per Elliot wave 8720 could still be a small resistance so that level should be played with caution! As we i have indicated with Green Lines, Nifty has given a probable Inverted H&S pattern and its still intact as stop loss which is usually at right shoulder low is still intact which is at 7800. Surprisingly target is at 9800 which is too juicy to trade with a small stop loss from current level but remember 8720 is cautious level. Though am not confident at fundamental side but technically we have few chances for a rally. We will get more confident if we close above 8720 but remember 100 day SMA at 8445 should act as a stop loss for all long trades.

Strategy for Traders: Stay with longs with final target at  8720 with trailing SL of 8445

Strategy for Investors: Hold 8500 PE as recommended before until next post!

 

 

Nifty Bank approaching “Line of Control”

Nifty Bank has seen sharp short covering after under performing in the month of December. Prior to December it had out-performed ..So during this Rock-n-Roll one level which acted a pivot was 19068 as marked horizontal in the graph over which Bull’s will get control over the markets. 

13th_jan

So as we could all mark that since last July, 19068 level has played role of resistance-Support and now we are again approaching the same. But this time its more crucial resistance because we also have 100 day SMA at the same level. From the Derivative markets also we have got highest open interest at 19000 mark which may be a small resistance.  Even a dragon fly Doji on daily chart suggest that bulls got back control at the end of the day. Even indicators are showing strong positive momentum which is giving me more confidence of probable breakout over 19068.

Now getting to Wave Theory, we have started a Wave B corrective move against a larger corrective Wave. Looking at a primary level, i conclude that we may get a Flat formation to larger wave which means this rally has all chances to kiss 20000 mark soon. Even post 19000 we have all resistances around 20000 which means 70 points move away from close today would trigger fresh buys for traders. Investors should still remain stock specific in Bank Sector as still many PSU’s are announcing willful defaulter which may have strong impact on profits in coming quarters. So Strategy would be simple to go long on Nifty bank with Stop loss of 18600  targets 19450/19960.

 

Still avoiding Metal Stocks? Not Tata Steel Now!!

Metal Stocks have been under performers since last 8 years, from 2008-2016 but not now!!! In a broader sense we may say that 8 year bear cycle of commodity prices have ended last year at fundamental level. We have seen global metal prices bouncing almost 20% from the lows in 2016 which has resulted in turned in many global companies like Rio Tinto and BHP. And now metal price hike effect would start appearing on indian metal company’s Balance sheet. But before fundamental guys say’s “BUY”, technical charts have already given a breakout…

tataSteel_Monthly_Jan17

Above chart is of TATA STEEL monthly time frame, where we could notice that stock has just notched out of symmetric triangle almost after being intact for 17 years!!  This clearly signs of a turnaround for long term.  On the upside as a yearly investor, u could see 600 mark but above that it would again be a double bottom breakout which activate target of 950..So ball is in your court to decide what you wanna do with the stock

Strategy for Investors:

Buy CMP: tgts 600/950 SL: 350

Now coming for short term traders, they too have a great trade ahead……………..

tataSteel_Daily_Jan17

So now lets have a look at Daily chart above which says a double bottom breakout with a breakout gap. Even the volumes at the breakout is strong…Yesterday which was a breakout on daily chart is the same price for breakout on Monthly chart as i stated above..So 437 mark is strong technical support now. Though it doesnt mean we can have a profit booking but we may be sure that each dip now is a buy.

Strategy for Traders: Buy with tgts of 500 sl: 412

Happy Profit mining to all!! 

 

“Bottom’s up” for Short term trader

Before you get my title wrongly, what i meant was that Nifty has given a Double Bottom confirmation for Short term trader which has taken traders on a high in quick time. In my previous post my target for traders was 8,250 which was achieved 2 days back but i was waiting for Double Bottom breakout confirmation whose neckline was at 200 day SMA, around 8287, making breakout more valid.

11_jan

Looking at the chart am sure many technical analyst would find current set-up juicy to trade for longs as firstly, we have closed above 200 day SMA. Secondly, we have got Double Bottom breakout, Thirdly, indicators are Juicy for positive movement and recent volumes too have been above 5 day average. BUT…….we as a medium term outlook we are still into corrective wave and this is just a Pull back rally and we have small resistance of 100 day SMA at 8445. Infact extent of pull back would decide the strength of correct wave. If this rally ends some where in the box marked which is around 8,563-8712 then corrective Wave could be a Zig zag and we may see new low below 7900 but if we witness this corrective rally to stop anywhere around 8,900 then it could be a Flat which means we wont trade below 7900 atleast for this year. So to sum up in simple words, traders still have some chance to trade longs.

Strategy for market participants:

Traders: Buy Nifty with tgts of 8445/8563/8712 sl: 8220

Portfolio Investors/Medium term traders: Start Buying FEB 8500 PE above 8440 spot level with sl of 8712

Spread Traders: Buy metal stocks such as Tata Steel/VEDL/JSWSteel and Short Nifty!