Trade, Live and Thrive

Wednesday, February 1, 2012

EOD Analysis CNX Nifty - 01 02 2012 - Global Cues and the 200DMA

Nifty - End of Day Chart - 01 Feb 2012

In our ' Looking Forward ' for this week (post here) we suggested that " .. we should watch this month's close of the S&P 500.." The relevant post (below) analyzed that its 'Advantage Bulls' so far as the S&P is concerned. No coincidence then, that Nifty cracked the all important 200 DMA soon after.

The Fib 76x now comes into our radar, divergences (marked)on the indicators need to be noted. We are also exactly at the channel top of the 13 month old weekly channel seen in the Analysis of the Nifty End of Week Chart (post here) - that is a 13 month old resistance !

S&P 500 - End of Month, January 2012 - Advantage Bulls.

S&P 500 - End of Month, January 2012

We studied this chart for the last three months of 2011. In our last post (here) we said that " the Bears would be impressed only if 1303+ happens to be the closing for Jan 2012"

January 2012 closed with 1312+ on the chart and its Advantage Bulls. Like the angle of climb of a fighter plane (which maxed out) changes, our channel lines too change after this price action. See new chart below. Staying above the Blue line is what would keep the Bulls in play for now...

S&P 500 - End of Month, January 2012 - New Channels

Tuesday, January 31, 2012

Analysis CNX Nifty with 60 min chart - 31 01 2012 - Support and Resistance

Nifty - 60 Min chart - 30 and 31 Jan 2012

In our ' Looking Forward ' for this week (post here) we opined that "..bears cannot really get themselves into the game unless the price stays below the 34 EMA or in the very short-term, below 5160.."

See above the action on Monday where the price closed below 5160 in the first hour - and proceeded on a Bear run. Today however the Bulls with a gap up persisted below the 5160 mark and post lunch cracked it and immediately shot the index up. Elementary example of resistance and support. Some free reads from the net on that subject, if you care to read 'em, pasted below..

http://www.stocktradingtogo.com/2009/05/11/support-and-resistance-rules-levels-technical-analysis/

http://www.investopedia.com/articles/technical/061801.asp#axzz1l2wPH3e4

http://en.wikipedia.org/wiki/Support_and_resistance

Meanwhile the 200 DMA as mentioned, continues to be resistance and we wait for the US close tonight, to see how the month closes.

Sunday, January 29, 2012

CNX Nifty Technical Analysis: Week ending 27 Jan 2012

Recap: The Nifty closed above the crucial 34 EMA on the Weekly chart and is hanging on to the 200 DMA on the daily charts. Another good week for the bulls. Lets check out the action with our Triple Screen Analysis.

Nifty - End of Month Chart - 27 Jan 2012

Nifty End of Month Chart: After closing above the 5 EMA last week, this month's candle now is approaching oversold as seen on the indicator at the bottom of the EOM chart above. Let us now zoom into the highlighted area with Weekly candles as in the chart below.

Nifty - End of Week Chart - 20 Jan 2012

Nifty End of Week Chart: A firm close above the crucial 34 EMA is the fist step towards breaking a 13 month resistance line - our channel top - shown in red above. Notice also the resistance at the STS indicator at the bottom of above chart. For a sharper picture we focus now on the encircled area with line charts on the End of Day charts below.

Nifty - End of Day Chart - 27 Jan 2012

Nifty End of Day Chart A: From being exactly at the blue line last week, price closed this week at the 200 DMA with a 'Hanging Man' candle pattern. Momentum is with the Bulls and Fib 76x is the target for medium-term Bullishness overall. The 34 EMA is downside support.

Looking Forward: Bulls may face resistance this week around the 200 DMA but bears cannot really get themselves into the game unless the price stays below the 34 EMA or in the very short-term, below 5160. So that can be our range as marked on the EOD chart above. Despite the recent disconnect of the Nifty with US markets we should watch this month's close of the S&P 500 - read analysis posted here.

Saturday, January 28, 2012

S&P 500 - End of Week Analysis - Déjà vu ?

S&P 500 - EOW Analysis - End of Week Jan' 23-27, 2012

Last week (post here) we saw the Price pull back and break into the Monthly channel's bottom line(red) - shown encircled above.

This week's candle is a Doji. The combination of the last two candles remind one of a Bearish Doji Star (studied on the Nifty here), the channel in white is the one the S&P 500 follows now. Earlier channel is in blue.

The Month's targets remain relevant. Intra-month movement by the price into the red Channel is same as in Nov'11.

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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.