Oct 31, 2013

Options Trading –What are Options?

Options constitute a lucrative trading tool in the stock markets..Many people are unaware of the options although they may have used them in someway or other at some point of their life..When talking of Options in stock markets,they cause a lot of confusion especially to newbies ; what is an Option and how it works.

Oct 29, 2013

Axis Bank ready for a bull run

Axis Bank-Inverse H&S Pattern
source:www.icicidirect.com
We saw in last few days and also discussed in our post on Nifty Outlook that Nifty has already entered into new bullish zone after trading for several years in 5000-6000 range and now it is heading towards target of 7000-7100 in the coming months.

Banking stocks remained under pressure for quite some time due to adverse micro and macroeconomic factors but now the tide is turning

Oct 27, 2013

Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart
 ( source : www.icicidirect.com )
In our last post,we talked of target of 6230 and 6345 for Nifty.Nifty moved up to 6250 and retraced back due to profit booking ahead announcement of Credit Policy by RBI this week.RBI action shall decide the further movement for the nifty.

Oct 24, 2013

Technical Analysis

Technical analysis is a tool of significance importance for traders in stock markets.It helps to identify the entry and exit prices for a trade in a security,be it a stock or index.It is based on the principle of 'History repeats itself ' and ' security price discounts everything '

Oct 20, 2013

Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart ( source:www.icicidirect.com )
In our last,post we talked of targets 6140 and 6220 for Nifty.In the week,Nifty after slipping towards 6050-6040 levels, staged a strong up move and continuing its uptrend closed at 6189 after touching 6200 level.
Nifty has given a breakout above the neckline of the Inverse Head and Shoulders Pattern with good volumes.

Oct 15, 2013

Inverse Head & Shoulder Pattern - How to Recognise and Trade It

Have you ever identified an Inverse Head & Shoulder Pattern on a chart and traded it accordingly? Let’s see what it is all about.The significance of this pattern for a trader lies in giving a confirmation of trend reversal for a security and the potential return it is able to generate if traded properly.
Head and Shoulder Pattern
Inverse Head & Shoulder pattern when formed shows that the previous trend of the security is coming to an end and a bullish trend is about to start.
On breakout of the pattern,traders need to be positioned on the long side to catch the big upmove that the security may give.

Oct 13, 2013

Outlook for NIFTY for the coming trading sessions

In our previous post,Nifty upmove was anticipated towards 6040 or higher and resistance near 6100 level.On Monday Nifty declined towards 5820 and took support there.Continuing with positive momentum,Nifty crossed 6040 and after touching 6107,closed tad below 6100 at 6096.
CaptureNF
Fig 1-Nifty chart
CaptureNF2
    Fig 2-TRIX & Momentum
                                                              
On daily chart,Nifty is in the process of making an Inverse Head and Shoulder Pattern,a trend reversal bullish pattern,the neckline ( orange trendline ) for which coincides with 6160-6170 (  Fig 1 ).If it manages to close and trade above that level with good volumes,it will open higher levels up to 7000 for nifty in future.
On last trading day,Nifty formed a Hammer candlestick on daily chart indicating some resistance at higher level of 6100. With FII's support and positive global markets,nifty is expected to keep maintaining positive trend.In Friday's session , FII's bought index futures worth Rs. 1000 crore and sold index options worth Rs.360 crore.On Nifty chart, TRIX ( Triple Moving Average Crossover ) has turned positive ( middle graph in Fig 2 ) and Momentum is already strong ( lower graph in Fig 2 )
For the coming days,Buy on dips strategy can be adopted .Nifty can be bought on dips towards 6050 and 5970 for higher targets of 6140 and 6220. ( spot levels )  

Oct 9, 2013

Heromotocorp breaking out of a bullish triangle pattern


          Heromotocorp is continuing with its uptrend,though it was stuck in a trading range for the past few days.In today's trading session , it attempted to break out of this range with good volumes.This trading range led to the formation of  a bullish triangle pattern on daily chart.

 On lower side, the stock is consistently taking support on the trendline supported by some short-covering.Short-covering is likely to continue in coming days also.In today's session again , it took support at the trendline after opening lower and gained strength throughout the day and managed to close above the upper trendline ( see black oval on chart )

         Technical oscillators like RSI ,slow stochastic s are already in buy mode and momentum oscillator is also in positive territory.
          Seeing all the scenario, Heromotocorp is expected to continue this uptrend in coming days. An upside of 8-10% can not be ruled out in a week or so. So the stock can be bought at the current market price or on decline towards 2000-2010 for the target of Rs 2232 as suggested by the triangle pattern.Stoploss for the trade can be placed safely around 1980-1990 ( spot levels ).
       
          

Oct 6, 2013

How to be a millionaire by investing in stock market

Investing in stock market is a major step towards wealth creation in one's life.Markets are always considered to be a better channel to achieve an individual's long term goals of creating corpus and to be a rich person.Almost everybody ,familiar to some extent to the financial markets , may have a perception that you put money in the markets and it multiplies several folds.This is because the common thinking is that you buy shares and sell shares and earn huge profits.This is true but the real test is when the time comes to apply this notion.Confusions start arising when you have prepared yourself to take equity exposure.

Oct 5, 2013

Outlook for NIFTY for the coming trading sessions

In previous post,we expected downside in Nifty with lower target of 5700 or lower.On monday,nifty started with slide which continued till next trading day and slipped to 5700 on tuesday.Highest put base is placed at 5700 which acted as a good support for the time being.Hence,nifty bounced back and moved towards 5950 before closing just above 5900 for the week.
For the coming trading sessions , nifty is likely to face stiff resistance around its previous resistance area of 5940-5970.The bias or the undertone in the index is positive with supportive FII;s data.In fridays session, FII's bought index futures to the tune of Rs 318 crore with sell figure of Rs 44 crore in stock futures.
On charts,nifty is well above 20 day moving average ( green line ) and 200 day moving average ( orange line ) which are expected to provide support on lower levels for the short-term.Momentum oscillators are in positive territory.Stochastics and RSI are also in buy mode.
Seeing the market momentum and global market scenario,markets are likely to trade positively and if crosses 5970 decisively,it can move towards 6040 or higher.Highest call base has also shifted from 6000 to 6100 which will pose stiff resistance at higher levels.

Oct 2, 2013

What is a Trendline and its significance

We always come to know of Trendline whenever we talk about technical analysis of any stock or an Index itself in the stock market.Knowledge of a trendline is an essential step for understanding and using the technical analysis for trading by the traders in the stock markets.Here,we shall be studying about it how to use it.
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Fig 1 (courtesy-www.moneycontrol.com)
By definition,Trendline is a line drawn on a chart of a security(stock,commodity,currency etc) or Index by joining the upper or lower price points.Trendline depicts the trend of the security and helps to predict the future price movements.

Intraday Trading-Formulas and Rules

Intraday Trading is an alluring idea for traders to make quick money in stock markets. After all,who would not be interested in making some quick bucks in a matter of minutes or hours.So,it is quiet popular in a section of traders.Intraday trading or day trading, as the name is explanatory,is the process of taking long or short position in markets and squaring off ( exiting)  that position before the close of the market on the same day.Intraday traders take the advantage of the movement in the price of the stock or the index during the trading session.Movement can be small or significant.