Trade, Live and Thrive: 04/01/12

Sunday, April 1, 2012

CNX Nifty 50 - Triple Screen 'Technical Analysis' - Week: 26 March to 30 March, 2012 - Relief Green as we wanted..

Recap:

Our view 'Looking Forward' last weekend (click for post), was 'After 5 red weeks, if a relief rally is coming up, this is one such time'
As the EOW chart below shows, we have a green candle for last week !

Intra Week, we saw the Nifty take support at the 200 DMA, and we suggested that the 5 EMA-200 DMA range had to break (click for post).

Bears failed to crack the 200 DMA on Thursday, then the Bulls pushed above the 5 EMA, to color this week's candle green, on Friday

What next?

CNX Nifty 50 - End of Month (EOM) Chart - 30 M arch 2012

Long Term View (or) Month Chart, each candle is 1 Month's price action (or) EOM:

A Bearish Harami is in place, with the completed red candle of March.

Lower volume for a red month, is Bullish.

Close above the 5 EMA and 13 SMA, that we track is also good for bulls.

Revision of Bearish Harami, at these links or elsewhere, is a good idea.

http://thepatternsite.com/HaramiBear.html
http://www.traderslog.com/bearish-harami-weekly-candlestick/
http://www.leavittbrothers.com/education/candlestick_patterns/bear/harami_bearish.cfm

CNX Nifty 50 - End of Week (EOW) Chart - 30 March 2012

Medium Term View (or) Week Chart, each candle is 1 Week's price action (or) EOW:

Bulls closed with a green candle, above the 34 EMA

Support was at the Trend line shown in black, famous for being a 13 month Resistance, once.

An 'ok' Hammer is the closest we can describe the last candle as, here are some reads.

http://www.thepatternsite.com/Hammer.html
http://www.leavittbrothers.com/education/candlestick_patterns/bull/hammer_bullish.cfm

CNX Nifty 50 - End of Day (EOD) Chart - 30 March 2012

Short Term View (or) Day Chart, with closing prices of each day in a line (or) EOD:

The price has clearly closed below the channel bottom, and then come back, to close above it.

The 5 EMA and 13 SMA, are still in a bearish Cross.

The MACD is below the zero line, as is the Histogram.

Price has closed, above all the 'Moving Averages(MA)' we track on this screen.

Looking Forward:
Currently the Index is neutral, across all three time frames.

Keeping above the Wall for this month (5180), & above the falling 34 EMA, Nifty stays Bullish.

Below the 200 DMA, if the bears manage to get there, Fib 61x is the next target.

The EOD chart of the Ichimoku study (Click) should be watched for the Senkou Span Cross.

The BSE Sensex 30 - Ichimoku Study - Week: 26 March to 30 March 2012 - and we got our green...

Quick Reference :

The Tenkan Sen - red line,

The Kijun Sen - blue line,

The Chikou Span - purple line,

The Senkou Span A - black line,

The Senkou Span B - grey line,

The Kumo - grey shaded area.

Signals studied in the past few weeks on BSE 30 - Week Chart (EOW) in brief: For details see here and here.

Senkou Span Cross: Strong Bearish Signal
Chikou Span Cross: Weak Bullish Signal
The kijun sen cross: Weak Bullish Signal
The Tenkan Sen/Kijun Sen Cross: Weak Bullish Signal
The Flat Kumo: Bullish Signal

For the latest study click this link

BSE 30 - End of Week Chart - 30 March 2012

Ichimoku Medium Term View (or) Week Chart (or) EOW of the BSE 30:

Last week (click to see post) we felt it was time for some 'relief green' and we got it (see last candle above)

Price took support on the Kijun Sen (blue line) and MVWAP.

Price is nudging into the Kumo.

A Bullish Senkou Span Cross is a few weeks away.

Other signals given above the EOW chart, add to this study.

To see the finer details, we use the EOD chart below.

BSE 30 - End of Day Chart - 30 March 2012

Ichimoku Short Term View (or) Day Chart (or) EOD of the BSE 30:

A Bearish Senkou Span Cross is nearly on - could touch and go too.

Price is in the Kumo.

Price has just crossed the Tenkan Sen, after being drawn down by the Flat Senkou Span B, and bouncing off it.

Resistance is the Kijun Sen and MVWAP.

Looks good for an up move, if the Senkou Cross is not Bearish.

Welcome Read

The Trading methods used here are suitable for those who (like me) are always Learners in the World Market (never presuming Mastery).

One learns with 'Technical Analysis' using Moving Averages, Channels, Time frames, Pattern & Candlestick Analysis, Fibonacci, Ichimoku Cloud, Oscillators & other Technical Indicators.

To comprehend the Dynamics of any Market, Peer Wisdom suggests, that we show plenty of Patience, keep it real Simple and adopt tons of Discipline.

We therefore use the same framework 'Patiently' every week - 'Simple' Technical Analysis Tools are repeated - The 'Discipline' of keeping a Neutral view is maintained.

So welcome to my notes - posted here for my Friends and Family.

Some Quotes..

There are times when playing the stock market that your money should be inactive - waiting on the sidelines in cash - waiting to come into play. In the stockmarket - time is not money - time is time and money is money. Often money that is just sitting can later be moved into the right situation at the right time and make a vast fortune – patience – patience. Patience is the key to success not speed.

Jesse Livermore.

That's been one of my mantras - focus and simplicity. Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it's worth it in the end because once you get there, you can move mountains.

Steve Jobs.

Discipline is the bridge between goals and accomplishment.

Jim Rohn.

Favorite Quote

"Why do we trade?

To be sure, trading allows us independence, the opportunity to work for ourselves. Trading also offers the prospects of a lifestyle in which evenings and weekends need not be consumed by work. Some of us crave the competitive aspect of trading, doing fresh battle each day. Others approach trading as a puzzle to be solved, deriving a sense of intellectual achievement. Finally, there is income. A successful trader can make seven figures in a year—and many of the traders I work with are living proof of that.

So why do they trade? Once you have the money, all of trading’s lifestyle advantages could easily be yours. Needs for competition and intellectual stimulation could be met in so many other ways. Why do traders remain traders long after they’ve won the game?

The great professions are those that serve as personal playing fields. They are the arenas we choose to express and develop ourselves. In mastering a discipline, we cultivate self-mastery. In writing a poem or placing a large trade, we capture—in a single act—our vision of how we see the world at that moment.

The great occupations are great precisely because they are such meaningful playing fields. Long after we’ve earned fame and fortune, the calling remains to be more than we are, to return to the arena and do battle with our limitations. The profound urge to extend the human grasp is common to all the great callings. To run faster, to capture more beauty, to predict ever better: in no small measure, our work is our pursuit of the godlike, however fleeting.

Maybe it is our different images of the godlike that animate our career choices.In work we find something divine within ourselves. Whether as scientists, monks, or traders, we strive for those moments when we are just a little closer to perfection, a little nearer to immortality. That is why we trade"

.... Brett N. Steenbarger

Inspiration

The Parable of Talents...

14 For the kingdom of heaven is as a man travelling into a far country, who called his own servants, and delivered unto them his goods. 15 And unto one he gave five talents, to another two, and to another one; to every man according to his several ability; and straightway took his journey. 16 Then he that had received the five talents went and traded with the same, and made them other five talents. 17 And likewise he that had received two, he also gained other two. 18 But he that had received one went and digged in the earth, and hid his lord's money. 19 After a long time the lord of those servants cometh, and reckoneth with them. 20 And so he that had received five talents came and brought other five talents, saying, Lord, thou deliveredst unto me five talents: behold, I have gained beside them five talents more. 21 His lord said unto him, Well done, thou good and faithful servant: thou hast been faithful over a few things, I will make thee ruler over many things: enter thou into the joy of thy lord. 22 He also that had received two talents came and said, Lord, thou deliveredst unto me two talents: behold, I have gained two other talents beside them. 23 His lord said unto him, Well done, good and faithful servant; thou hast been faithful over a few things, I will make thee ruler over many things: enter thou into the joy of thy lord. 24 Then he which had received the one talent came and said, Lord, I knew thee that thou art an hard man, reaping where thou hast not sown, and gathering where thou hast not strawed: 25 And I was afraid, and went and hid thy talent in the earth: lo, there thou hast that is thine. 26 His lord answered and said unto him, Thou wicked and slothful servant, thou knewest that I reap where I sowed not, and gather where I have not strawed: 27 Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received mine own with usury. 28 Take therefore the talent from him, and give it unto him which hath ten talents. 29 For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken away even that which he hath. 30 And cast ye the unprofitable servant into outer darkness: there shall be weeping and gnashing of teeth.

The Holy Bible: Matthew - Chapter 25.