Trade, Live and Thrive: 07/14/13

Sunday, July 14, 2013

S&P 500 - Triple Screen 'Technical Analysis' - Week: 08 July to 12 July: 2013 - Bulls break towards new High

S&P 500 - End of Month Chart (EOM) - Channel analyzing Data from mid 2009, onward - as on 12 July'13

S&P 500 - End of Week Chart (EOW) - Channel analyzing Data from Aug' 2011 onward - as on 12 July'13

S&P 500 - End of Day Chart (EOD) - Channel analyzing Data from Nov'2012, onward - as on 12 July'13

Learning from the Past Week: (click here for the post)

Patterns:

With the 'Three inside Down' on the Month Charts kept at bay last week, index moves towards earlier 'All time highs' #M1.

Support & Resistance:

Bulls break through the previous week's channel bottom #D1 - and we have a new red channel for the Day Chart.
Index almost near the 'All Time High' of May'13 - which is resistance for Bulls #D1.

Moving Averages:

5 EMA deflects the 13 SMA, completely on the Medium term charts #W1.
July uses the Long Term 5 EMA as support #M1.
Bulls keep above the 13 SMA on the Week Charts #W1.
Index kept above the 5 EMA on the EOD charts, all of last week #D1.

Indicators:

RSI keeps above its MA while below oversold #W2.
Oscillator nudges above the oversold mark #D2.

Bulls get a COMPLETE deflection of the 5 EMA and 13 SMA #W1 and push for a new 'All Time High'

Looking forward into the next Week:

Patterns:

Bulls yet to clear off the Triple Top Threat conclusively ...

Support & Resistance:

All Time High (May'13) #D1 remains the next resistance for the Bulls.
The 76.4% Fibonacci Retrace #M1 - is the next major support for the Bears to contend with.

Moving Averages:

Staying above the 5 EMA on the EOM #M1 - shows long term strength of the Bulls.
5 EMA & 13 SMA #W1 - Deflection was good for Bulls.
5 EMA & 13 SMA #D1 - Cross would be good for Bears.
Getting below the 13 SMA on the Week Charts #W1 important for Bears.

Indicators:

Oscillator #D2 in oversold favors the Bulls.
RSI sliding below its MA while below oversold #W2 - good for bears.

Bears hope the All time High holds, Bulls call for a new High and more #M1.

CNX Nifty 50 - Triple Screen 'Technical Analysis' - Week: 08 July to 12 July: 2013 - 3 outside up gains..

Nifty 50 - End of Month (EOM) Chart - Channel analyzing Data from 2008 onward - as on 12 July'13

Nifty 50 - End of Week (EOW) Chart - Channel analyzing Data from Mid 2011 onward - as on 12 July'13

Nifty 50 - End of Day (EOD) Chart - Channel analyzing Data from Nov' 2012, onward - as on 12 July'13

Learning from the Past Week: (click here for the post)

Patterns:

June's 'Hanging Man' Candle & May's Shooting Star on the EOM #1 Charts - yet to kick off, even as the Bullish patterns on the EOW come into play.
On the Medium Term EOW, the previous week's 'Bullish Engulfing' turned into a 'Three Outside Up' and gave the Bulls, plenty of green #3.

Support & Resistance:

Bulls break out of Day Channel top #5.
The 76.4% Fibonacci retrace of the 'Jan'12 low to All time high' cleared #5.
STS #4 turned out to be a good support for Bulls.

Moving Averages:

5 EMA and 13 SMA cross Bullishly #5.
5 EMA and 13 SMA in the Medium Term, touch for deflection or cross #5.
Index closes above the critical 13 SMA on the Medium Term #3.

Indicators:

'Trend Deviation' Indicator #2 on the long term charts show Bulls a pip ahead..
Volumes pick up #6. Overall lower #4.
MACD and its MA near the zero mark and Histogram ticks positive #6.

Bulls use the 'Three Outside Up' #3 to gain ground in their 3rd green week..

Looking Forward into the next Week:

Patterns:

The 'Bullish Engulfing' which turned into a 'Three Outside Up' #3 may conflict with June's 'Hanging Man' Candle & May's Shooting Star on the EOM #1 as we approach month end.

Support & Resistance:

The Day Channel top marked #5 is now resistance - for the Bulls.
The 76.4% Fibonacci retrace of the 'Jan'12 low to All time high' is support zone for Bears to crack #5.

Moving Averages:

Index staying above 6006 means 5 EMA and 13 SMA make a Bullish Cross, else a Bearish Deflection #3.
Keeping above the 200 SMA on the Day Charts good for Bulls #5.
13 SMA on the Medium Term - needs to be re-crossed by the Bears to get back in the game #3.
50 SMA and 200 SMA, convergence towards a death cross - moving closer for the last 10 days #5.

Indicators:

'Trend Deviation' Indicator #2 remains in Bull zone - to be watched.
Volumes dipping for the up move, good for Bears #4.
STS resistance line did and continues to support Bulls for an up move #4.

Bears hope that on the Medium Term Screen #3, the 5 EMA and 13 SMA deflect with the index below 6006 for the week - Bulls look forward to the Three Outside Up giving some more gains #3

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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.