Trade, Live and Thrive: 01/06/14

Monday, January 6, 2014

S&P 500 - Triple Screen 'Technical Analysis' - New Year Reds - Week 2 of January 2014.

S&P 500 - End of Month Chart (EOM) - Channel analyzing Data from mid 2009, onward - as on 03 Jan'14

S&P 500 - End of Week Chart (EOW) - Channel analyzing Data from Aug'2011 onward - as on 03 Jan'14

S&P 500 - End of Day Chart (EOD) - Channel analyzing Data from Oct'2013, onward - as on 03 Jan'14

Learning from last Week: (click here for the previous post)

Patterns:

Bullish '3 Inside up' #M1, on the Long Term Charts kept November and December candles green, with a new ATH.
A Bearish Harami is formed by the last two candles on the Medium Term Charts #W1.

Support & Resistance:

Index slides well below the 5 EMA on the EOD all of the new year, enough to paint the week red #D1, #W1.
EOW channel top resistance (orange line) violated, but does hold up the Bulls #W1.

Moving Averages:

The Month candle stayed above the 5 EMA showing the long term strength of the Bulls #M1.
Bulls close above the 5 EMA on the EOW to demonstrate that they ended the week strong #W1.

Indicators:

RSI 13, stays in the overbought #W2.
Month Chart Oscillator remains below the overbought, after the August'13 Close #M2.

Wrap:

Bulls start the year on a red note but retain strength - Bears manage to hold fort at the EOW channel top #D1, #W1..

Looking forward into this Week:

Patterns:

Long Term Chart's Bullish 'Three Inside up' (Study link here, here or elsewhere) #M1 - still active.
Three Inside Down (Study links here, here or elsewhere), can trigger on Medium Term Screen, if this week's close is below 1831 #W1.

Support & Resistance:

200 SMA and EOD channel Bottom on the Short Term Chart are Support for the Bulls.
'All Time High' Line and the Channel Top #W1 are resistances.

Moving Averages:

Bears need to get below the 5 EMA on the EOW to get a life #W1.
Bulls need to keep the 5 EMA on the EOD above the 13 SMA to keep their life #D1.

Indicators:

Stochastic 34 3 4 in the overbought zone, works for the Bulls #D1.
Oscillator popping into the over-bought this month, can set the Bulls free #M1.

Wrap:

Bears trust the EOW channel top #W1 holds the Bulls - Bulls seek to get green back into 2014 candles (Day, Week & Month).

The Dow Jones - Ichimoku Study - ATH Cross - Week 2 of January 2014.

Our Dow chart gets 'auto awesome', thank you G+ :)

Dow 30 - End of Week Chart (EOW) - Analyzing 24 Month's Data - as on 03 Jan'14

Introduction / Primer to Ichimoku can be read at this link (click).

Learning from last Week: (click here for previous post)

Bulls cross to another new ATH for the new year #W2.
Senoku Span A & B converge a little and head up #W3.
Gap between the Tenkan Sen and Kijun Sen steady #W2.

Wrap: Bulls get a New Year ATH, Bears force a red week #W2.

Looking Forward into this Week:

Convergence of Senoku Span A & B, a concern for Bulls #W3.
Gap between the Tenkan Sen and Kijun Sen wide, giving the Bulls some relief #W2.
Critical for Bulls to stay above current support (Tenkan Sen) #W2.

Wrap: Bulls look to keep momentum and make new ATHs while Bears pray the Tenkan Sen cracks #W2.

CNX Nifty 50 - Triple Screen 'Technical Analysis' - Wall Fall - Week 2 of January 2014.

Nifty 50 - End of Month (EOM) Chart - Channel analyzing Data from 2008 onward - as on 03 Jan'14

Nifty 50 - End of Week (EOW) Chart - Channel analyzing Data from Mid 2011 onward - as on 03 Jan'14

Nifty 50 - End of Day (EOD) Chart - Channel analyzing Data from Aug'2013, onward - as on 03 Jan'14

Learning from last Week: (click here for the previous post)

Patterns:

November and December candles will set up a Long Term 'Three Outside up' if January closes above December Close #M1.
The last two candles on the EOW #W1 form a Bearish Engulfing Pattern - This week closing below 6211 produces a Medium Term 'Three Outside Down' Candle Pattern.

Support & Resistance:

Bulls stay clear of the 13 SMA on the EOW #W1 despite the bear onslaught.
Bulls also use the 34 EMA, 50 SMA & Channel mid line on the EOD as support and were resisted near the previous ATH 6343 (Current ATH being 6415) #D1.

Moving Averages:

EOD - 50 SMA and 200 SMA stay crossed bullishly in a Golden Cross #D1.
The short term 5 EMA poised to move below the 13 SMA #D1.

Indicators:

STS stays above resistance line #W2, a strong support for Bulls.
Bears crack this Month's Wall (6280) is style, with a 100+ point fall to start 2014 with a red week.

Wrap:

Bulls retain short term screen by a thread, despite Wall fall - Bears fail at the Weekly 13 SMA yet again #W1.

Looking Forward into this Week:

Patterns:

Bullish 'Three Outside up' (Study link here, here or elsewhere) on the Long Term Chart #M1 is possible - to be watched for.
Bearish 'Three Outside down' (Study link here, here or elsewhere) on the Medium Term Chart, #W1 is on, if this week closes below 6211.

Support & Resistance:

34 EMA, 50 SMA and Channel Mid line remain weekly supports #D1.
Week channel top #W1 remains a pretty decent resistance for Bulls.

Moving Averages:

Golden Cross (study here, here or elsewhere) 50 & 200 SMA - can continue to give the Bulls verve to attempt new ATHs.
Keeping above the 5 EMA on the Month Chart, bulls display long term strength.

Indicators:

STS keeping above its support line, works for the Bulls #W2.
Bulls need to get above the Wall for the current series i.e. 6280 (Wall = Approx Hawala rate - study link here, here or elsewhere) to get back into the game.

Wrap:

Bulls seek to clear the Wall and target the ATH - Bears hope to keep below the Wall and ensure a Medium Term 'Three Outside Down'.

BSE Sensex - Ichimoku Study - Tenkan Sen Bounce - Week 2 of January 2014.

BSE 30 - End of Week Chart (EOW) - Analyzing 12 Month's Data - as on 03 Jan'14

Learning from last Week: (click here for previous post)

Bulls resisted near the ATH sent back to the Tenkan Sen #W2.
Tenkan Sen resists the Bears #W2.
Senkou Span gap steady #W3.

Wrap: Bears fail at the Tenkan Sen but get a red week #W2.

Looking Forward into this Week:

Chikou Span keeping above the Price Line critical for Bull moves #W1.
Bulls need to keep above the Tenkan Sen to remain in the game #W2.
Thicker Kumo means future support for Bulls if the Index is above the Kumo then #W3.

Wrap: Bears look get the Index below the Tenkan Sen #W2. Bulls eye the ATH.

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.