tag:blogger.com,1999:blog-13589235706174348062024-03-05T22:00:39.332-08:00TradingTechnicalsAnonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.comBlogger44125tag:blogger.com,1999:blog-1358923570617434806.post-90686876852710435402013-12-13T07:10:00.001-08:002013-12-14T07:23:18.348-08:00Importance of Support and Resistance in Trading <div dir="ltr" style="text-align: left;" trbidi="on">
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Support and Resistance are very important to a Technical Analyst or a Trader when planning for a trade.You,as a trader or technical analyst,should never undermine the significance of these two aspects of the trading plan and you should be very clear of these two levels before you enter a trade.Support and Resistance are your entry and exit levels for a long trade and vice versa for short trade.Moreover,prior knowledge of Support and Resistance brings much needed discipline in trading which is an important step for you to become a <a href="http://trading-technicals.blogspot.in/2013/11/how-to-be-successful-trader-in-stock.html" target="_blank">successful trader</a>.<a name='more'></a>When you are aware of these levels,you know when to take profits in case of profitable trade and to exit the loosing trade when your stop-loss gets triggered.These levels are formed as a result of popular notion of Technical Analysis<br />
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<i><b> " History Repeats Itself "</b></i></div>
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Let us understand what is a Support and Resistance and how they are important for your trading plan;</div>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgMVQ3gikTh9JK7BCCzzMdSWSoB_X2Oh9cSzrmTqLy1l3L-H6IYuu2HA3ESN3l2a5cm-_7haqCxsk9Dct7yP7omAFgoywF_rEuBIz1PQRaftSvUwwxmG-u5CZaJy-Dar9XIXslCh8g9LH4/s1600/support.PNG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgMVQ3gikTh9JK7BCCzzMdSWSoB_X2Oh9cSzrmTqLy1l3L-H6IYuu2HA3ESN3l2a5cm-_7haqCxsk9Dct7yP7omAFgoywF_rEuBIz1PQRaftSvUwwxmG-u5CZaJy-Dar9XIXslCh8g9LH4/s1600/support.PNG" height="139" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Support Line</td></tr>
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<b>Support :-</b> Support is a price level which corresponds to the demand of the security in the market.So it is the price level at which there are lots of buyers to buy that security.A stock falling to lower levels stops at a price levels which may reflect its fair value at that time and starts rising again.When the stock again falls after rising,it tends to stop at the price level where it stopped previously and buyers start emerging in anticipation of price again.When the buyers outnumber the sellers,price stops falling and either consolidates there or rebounds,thus confirming the Support for that security.</div>
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More the number of times stock rebounds from that price level,more strong the Support becomes.These levels remain in the mind of markets,so even if the stock visits that level after months or years have passed,that levels is expected to provide Support to the falling stock.</div>
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It is not that every time stock visits that levels,it will bounce back.It may or may not.If the selling pressure is too high like in situations of weak sentiment or panic,these support levels give away and the stock falls to lower price levels after piercing the Support.Break down from the Support becomes more significant when it happens with high ( more than normal average ) volumes.</div>
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Usually the support line are drawn straight horizontal lines on the charts of the security or stock.A rising <a href="http://trading-technicals.blogspot.in/2013/10/what-is-trendline-and-its-significance.html" target="_blank">Trend line</a> made by joining the lowest points in a particular time period also act as Support and can be taken into consideration while starting a trade.</div>
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<b>Importance of Support :-</b> If a falling stock takes support at the Support line,traders may consider buying the stock in anticipation of price appreciation.On the other hand,if a stock breaks important Support levels,traders can short sell the stock and go short.</div>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjiA9r0CfKiiqJDAmCfKhxjxItYhmCYQKZL6udgbEO0eDB1ZL-eogDKPE1q_DK6PVlQopSaTOXT6HooksTXA5IelnsQ5CwsCkKf0336lFTzgNUl4euP5VKKmhA8vHMBZdWAaPuFgeE5VDw/s1600/resistance2.PNG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjiA9r0CfKiiqJDAmCfKhxjxItYhmCYQKZL6udgbEO0eDB1ZL-eogDKPE1q_DK6PVlQopSaTOXT6HooksTXA5IelnsQ5CwsCkKf0336lFTzgNUl4euP5VKKmhA8vHMBZdWAaPuFgeE5VDw/s1600/resistance2.PNG" height="148" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Resistance Line</td></tr>
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<b>Resistance :-</b> Resistance is the price levels of the security or a stock which corresponds to the supply of that stock in market.It is opposite to Support.It is the price level where sellers outnumber the buyers in the market.A stock which is rising, may stop at the Resistance line and retrace back to lower level.Whenever the stock will rise towards Resistance line,sellers will start emerging,stalling the price rise.More the number of times stock retraces from Resistance,more strong the Resistance.</div>
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Whenever the momentum of price rise is strong in the stock and buyer are more aggressive than the sellers,stock will break above the Resistance line after piercing it and enters new territory which becomes new trading level for it.As in case of Support,a falling <a href="http://trading-technicals.blogspot.in/2013/10/what-is-trendline-and-its-significance.html" target="_blank">Trend line</a> made by joining the highest points is also expected to provide good Resistance.</div>
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<b>Importance of Resistance :-</b> A trader who is long in trade should consider taking profit when stock reaches near the Resistance levels and also can short sell or go short at the Resistance line.Remember,shorting should be done only below Resistance line.</div>
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It is worth mentioning that after breakout from the Resistance line,this line becomes the Support for the stock and in case of breakdown from the Support line,this line becomes the new Resistance line for the stock.So it can be traded accordingly by the traders.</div>
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{Source of images:-<a href="http://www.icicidirect.com/" target="_blank">www.icicidirect.com</a>}</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com1tag:blogger.com,1999:blog-1358923570617434806.post-75177344272284112272013-12-11T08:46:00.001-08:002013-12-13T23:17:44.822-08:00How to do News Trading ?<div dir="ltr" style="text-align: left;" trbidi="on">
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News Trading is a strategy of trading by taking position,long or short, in securities ahead of any big news which is so significant that it may lead to massive wild moves in that security and closing the position after the news has been released.Though you may trade in any security for news trading but the most popular securities are the Currency Trading and Stock Trading.News can be of any type like Monetary Policy announcement,quarterly results for any stock,inflation data,IIP data or GDP figures or any stimulus or Jobs data</div>
<a name='more'></a>etc.<br />
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<b>Should you do News Trading?</b></div>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhKkoiZFPBZaEwpjlIQ2zoSspwMKHU9JOQaU7aL1Gy-wh6xruBG-kEJLNsPx1XanedexEkSpONOSIFYnprt668ouL9iAakfVVZ1SzDI3GsrqRnRQZCwyxgCrBKdddlg6Zu7KTz59AVG4_I/s1600/6093690339_a09493f126_n.jpg" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhKkoiZFPBZaEwpjlIQ2zoSspwMKHU9JOQaU7aL1Gy-wh6xruBG-kEJLNsPx1XanedexEkSpONOSIFYnprt668ouL9iAakfVVZ1SzDI3GsrqRnRQZCwyxgCrBKdddlg6Zu7KTz59AVG4_I/s1600/6093690339_a09493f126_n.jpg" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">News Trading-source;<a href="http://www.flickr.com/photos/teegardin/" target="_blank">kenteegardin</a></td></tr>
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News Trading can be highly rewarding if you are positioned on the right side of the market and can be equally destructive in opposite scenario. In fact this strategy has the potential to multiply your invested capital if you choose the right instrument and do it after doing your home work properly.On the other hand,you loose your money very fast if you fail to plan your strategy very meticulously.So the question is that Should you do News Trading?If yes then what are the important things to take care of before you enter the trade?</div>
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A successful mantra of Trading in Stock Market is ;</div>
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<b> " <i>Buy on Rumors and Sell on News "</i></b></blockquote>
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News of any above mentioned data are released on a prefixed date and time.So it becomes easy to decide that when you should position yourself in the trade.The problem is to guess the direction in which the security is expected to move.How do you guess that?The big players in the market have the luxury of buying the news from the leading sources and websites which have the access to that data prior to announcement because they can afford it and they take their position accordingly but you as a small trader have to live without it.So much odds are stacked against you.What are the important things you can do so that you also enter the trade confidently?There are some clues to it :-</div>
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- You should gather as much knowledge as possible about the upcoming event on which you want to trade by reading latest newspapers,articles,magazines and listening on electronic media.Sometimes,specific leading agencies do the polls or surveys before that event on the expected outcomes and share it with the public.You should be aware of those surveys and the expected outcomes.Find and keep in touch with the website that publish the news ahead of others</div>
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-Second important thing which i personally also do when trading a news is checking the Option Chain for that security.Actually Option Chain can be very significant source of information to see how majority of the traders are positioned before the release of news if you are able to read it accurately.Check out on which Strike the Open Interest is highest for the Call Option and Put Option in the Option Chain.</div>
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If the security's price is very near to the Put Strike with highest Open Interest,it is likely to act as good support for the security on lower side with some fluctuation margin .Similarly,if the security price is very near to the Call Strike with highest Open Interest,it is expected to pose stiff resistance on upside,thus limiting the upside.</div>
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You can also calculate the Put to Call Ratio by dividing the Put Option Open Interest by the Call Option Open Interest of that particular strike.If the ratio comes out 0.6 or below that for any strike,that level for the security can act as strong resistance.In case the ratio is more than 0.6,it can act as good support.Ratios of 2,3 or 4 act as very strong supports.</div>
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Hence,if a security is trading at a level where the strike in option chain gives ratio of 0.20 or 0.10,i am comfortable in taking short position in that security at that level.Similarly,if that security is trading at a price where the strike in option chain gives ratio of more than 2,i take long position in the security.</div>
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Though this method is not totally error proof but at least gives some educated guess.</div>
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Another factor you can look out in the Option Chain is level of Volatility.High volatility than normal levels shows the fear in the market and it can be the precursor of impending fall in the security price.High Volatility along with ratio of less than 0.2 is good combination to suggest going short.Low volatility can be taken the other way around.</div>
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- Though Charts have limited role when it comes to News Trading,but it is always prudent to check out daily chart at least once before you enter the trade.There may be some pattern breakout or breakdown would have happened on the charts before the news release,the target of which may be achieved after the news comes out.</div>
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Personally,i always check for TRIX or Tripple Moving Average Crossover indicator on the daily chart of that stock.Sometimes,indication shown by the TRIX coincides well with our other studies and gives much needed confidence to go into the trade.</div>
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I would suggest that you carefully read all these essentials before entering the trade and trade only if you are convinced enough about your decision.</div>
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<b>Risk Management</b></div>
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Now as we discussed earlier that it is highly risky to trade the News,so there should be proper risk Management before the trade.How you can manage the risk lets read out :-</div>
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-Don't trade in large quantities. Keep the volumes low to keep risk low.</div>
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-Use limit orders and strict stop loss.Market orders are big NO.Markets can become a wild beast on news release which becomes difficult to contain.Remember,capital protection should be your first priority.</div>
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-A very good and flexible tool to trade news is Options and i personally use options.The advantage with Options is that you have a fixed maximum loss which is the Premium you pay to buy the option and the reward is unlimited if you took accurate trade.In fact,the amount you invested in buying option can even multiply if the move is substantial after news release.</div>
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So you can do the News Trading if your risk profile allows by doing thorough research and proper risk management as it can be a highly profitable strategy.Good luck.</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com2tag:blogger.com,1999:blog-1358923570617434806.post-89256604982834772222013-12-08T05:51:00.001-08:002013-12-10T22:54:47.752-08:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
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In our previous post on Nifty Outlook,we expected Nifty to move towards 6220 and 6300.Nifty,after slipping towards 6150 levels,came back strongly and tested 6300 after crossing 6220,finally closing around 6260 level for the week.</div>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj-hChno_KtbJx_9xdDHldFBcweRWGw0ZHVXwunt0AivupNSBvRkvpTsDAWKAm6sTHAQXpowBjXZswEWq_NfiZ1ullyOE-5FwEDGQDA0B__uJC8ve5TQWr4qmAO0Q7FmiXcJx-E1A4DiXM/s1600/NNIIF.JPG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj-hChno_KtbJx_9xdDHldFBcweRWGw0ZHVXwunt0AivupNSBvRkvpTsDAWKAm6sTHAQXpowBjXZswEWq_NfiZ1ullyOE-5FwEDGQDA0B__uJC8ve5TQWr4qmAO0Q7FmiXcJx-E1A4DiXM/s1600/NNIIF.JPG" height="176" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty Daily Chart<br />
[source : <a href="http://www.icicidirect.com/" target="_blank">www.icicidirect.com</a>]</td></tr>
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Nifty is continuing with its bullish trend.In the process,it again broke out of a bullish triangle at 6230<br />
on a daily chart.This pattern gives much higher target for Nifty in the coming days.</div>
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Though leading indicator Slow Stochastic is showing negative crossover indicating overbought market,market is expected to continue the strong momentum it gained</div>
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after taking cues from Exit Polls of 5 state elections<br />
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released on Friday</div>
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FII's data is also continuously positive for the markets.</div>
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Hence,in coming days we expect Nifty to test previous highs of 6357 and above that a level of 6490 as suggested by the triangle pattern on daily chart.Keep stoploss at 6200.</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com6tag:blogger.com,1999:blog-1358923570617434806.post-22771752042945729422013-12-07T05:12:00.001-08:002013-12-07T05:19:43.536-08:00Define your Risk Profile before Stock Trading <div dir="ltr" style="text-align: left;" trbidi="on">
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiujuSZxWqI5PNXr_ZGf-qdyUTMNBBByXXH0x8Rei-P2wI80zWpJRH5DMYjKBA5vi1KKyJpBe6Nvmg7AA6TNLsGZ84yRijJ8u8db9LwfW0xci6-18BbJr6sZkCFGly5nIms9Gu5PozXZcA/s1600/Capturerr.JPG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="163" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiujuSZxWqI5PNXr_ZGf-qdyUTMNBBByXXH0x8Rei-P2wI80zWpJRH5DMYjKBA5vi1KKyJpBe6Nvmg7AA6TNLsGZ84yRijJ8u8db9LwfW0xci6-18BbJr6sZkCFGly5nIms9Gu5PozXZcA/s200/Capturerr.JPG" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Know your Risk profile</td></tr>
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Stock markets,though have the potential to produce greater returns than other asset classes,are associated with high risk.Infact, higher the risk higher is the return or vice-versa.So it becomes imperative to understand that you know the risk before entering the markets. Every individual has his own risk taking capacity or Risk Profile when it comes to his trading or investment decisions.So what are the factors that define your Risk Profile?<a name='more'></a>Let's take a look ;</div>
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1.<b>Knowledge</b> :- It is said that Knowledge leads to Confidence and Confidence leads to Success.If you know what you are doing and how it is to be done then half the battle is won.Learn as much as you can by reading the literature about trading and investing.Working in stock markets is an ever learning process.When you have knowledge, you know the how much risk to take and how to manage it accordingly in different situations.Ultimately, Knowledge is Power.</div>
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2<b>.Savings</b>:-Do you enough savings to take care of your needs in case of any undesired financial situation? If the answer is No,you should seriously look at this aspect.Everyone of us can fall into a situation of financial emergency like unfortunate job loss,any illness or accident when we need cash urgently. So make some investments into risk free instruments and most importantly create an Emergency Fund.Emergency Fund is the cash which is always available to you if the need arises.General rule of thumb is that you should have atleast six times of your monthly income as your Emergency Fund.After doing all these necessary requirements, you can look for trading with the left behind cash.</div>
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3.<b>Age</b>:-Your age is also an important factor in determining your risk profile. At young age,you may want to take some risk to earn higher return.This is because at young age you may not have responsibilities of family or married life and also you can give more time to your trade or investment to recoup the loss in case you are in a loss in your investment.In older age when you are nearing your retirement, you would not want to risk your money because your regular income is going to be stopped after retirement.</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com3tag:blogger.com,1999:blog-1358923570617434806.post-7220626705014634362013-12-06T00:09:00.001-08:002013-12-06T19:40:19.072-08:00Equity Linked Savings Scheme (ELSS)-A Tax Saving & Investment Option<div dir="ltr" style="text-align: left;" trbidi="on">
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As the financial year nears its end,every individual or invester starts looking for tax saving instruments which should yield handsome returns along with primary requirement of saving tax.There are several <br />
options available in the market which are commonly used by people like Public <br />
Provident Fund (PPF),National Savings Certificate (NSC) or Unit Linked Insurance Plans (ULIP).Although, these are quite popular<br />
<a name='more'></a> but there are some disadvantages with them.PPF's and NSC's have a long lock-in period,ranging from 8-15 years and the returns produced by them fail to beat Lifestyle Inflation so that real returns are not sufficient to acc<u>o</u><u>mmodate</u> the purchasing power.ULIP's have the potential to beat the inflation but they are quite costly and require investment for 15-20 years to yield those gains.So what is the best option?<br />
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<b>Equity Linked Savings Scheme (ELSS)</b></div>
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Equity Linked Savings Scheme or ELSS as it is popularly called is proving to be a good alternative to these options.ELSS is a Mutual Fund investment which also gives the advantage of tax saving.Due to equity exposure,the ELSS provides the return which also beats the inflation.Although the risk involved with markets are there but if you choose a good fund with good track record and little longer period of investment,ELSS is capable of fairing far better than other mentioned instruments.</div>
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Second advantage with ELSS is that it has a lock-in period of 3 years only compared to longer period in PPF & NSC.ELSS is a type of <a href="http://trading-technicals.blogspot.in/2013/11/sip.html" target="_blank">Systematic Investment Plan (SIP)</a> which is done in a Tax Saving fund scheme on regular intervals.If you opt for three years ELSS on monthly basis,depositing your fixed amount every month,you can withdraw that monthly deposited amount after three years and not the whole amount invested in three years.All in all,you have to keep every installment for three years in the fund.</div>
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Also you need not to deposit the whole amount in lump sum basis.You can start investing in ELSS from the start of the new financial year after calculating the total amount you need to save for tax saving and dividing it into 12 equal installments for the 12 months.</div>
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So,if you have a conservative risk profile,want to save tax on your incomes and willing to give a little longer time than lock-in period to your investment by choosing carefully a good mutual fund scheme, ELSS can do wonders for you.</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com2tag:blogger.com,1999:blog-1358923570617434806.post-10362204479697366932013-12-01T07:40:00.000-08:002013-12-01T07:40:14.062-08:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div style="text-align: justify;">
In our last post on Nifty outlook,we expected downside targets of 5975 and 5900 for Nifty.Nifty however staged sharp pullback on the back of considerable short covering and closed at 6177 for the week.</div>
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<br /></div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgS9fCBskTPR8qzsYqEugOOdNBaOhGAi7VaGYkxDWdW7jBxVYSF-bh8hBfSKm5ERSZEtzAshvapqjPUf09EEO38wktNJ55Io8cpU4T0rKOLKhEiFP6kdGEec1cFO4BkygsaoykCjGEbr7Y/s1600/nifty.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgS9fCBskTPR8qzsYqEugOOdNBaOhGAi7VaGYkxDWdW7jBxVYSF-bh8hBfSKm5ERSZEtzAshvapqjPUf09EEO38wktNJ55Io8cpU4T0rKOLKhEiFP6kdGEec1cFO4BkygsaoykCjGEbr7Y/s1600/nifty.PNG" height="130" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty-Triangle Pattern Breakout</td></tr>
</tbody></table>
<div style="text-align: justify;">
On daily chart,Nifty has given breakout (blue circle) above a Triangle chart pattern which is a bullish sign for Nifty in the short-term period.</div>
<a name='more'></a>In the process, the index also closed above 20 Day Simple Moving Average.The short-term indicators ; stochastics and TRIX have also come into buy mode (see green circles in figure 3 ).<br />
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<br /></div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; margin-right: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiy6e6gpojG4c33ucc1ge2Le9jL_TK_O4_XLG7si5DZ-qAyeCxoCLDvt7BVmRk4abnr3ADC1o19Jz-oJfV-MOnxKVBpIeC_IzW5DqhKPnGHK0eJwo07VTqU2qhokIt1P3rHNz8uyOrlOgc/s1600/nifty-2.PNG" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiy6e6gpojG4c33ucc1ge2Le9jL_TK_O4_XLG7si5DZ-qAyeCxoCLDvt7BVmRk4abnr3ADC1o19Jz-oJfV-MOnxKVBpIeC_IzW5DqhKPnGHK0eJwo07VTqU2qhokIt1P3rHNz8uyOrlOgc/s1600/nifty-2.PNG" height="134" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Bollinger Bands</td></tr>
</tbody></table>
<div style="text-align: justify;">
The target for this Triangle Pattern breakout comes at near 6300 levels on the Nifty.Another indicator ,Bollinger Band (figure 2) also shows that Nifty may bounce towards upper channel which corresponds to 6300 level on Nifty.</div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg1zvg4Mdtce8AleRTarPl9p_-ibl64e9nfLOjAGZ2xg37Ryien93F-RBT0R4v7jR9iYomkIUaLOdSf8UUyxJ58dRPUNUN9ESeA8Yl0ToLmzqFNPiexPv5PNRM9sde0SNxEhSs4q-vWckM/s1600/nifty-3.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg1zvg4Mdtce8AleRTarPl9p_-ibl64e9nfLOjAGZ2xg37Ryien93F-RBT0R4v7jR9iYomkIUaLOdSf8UUyxJ58dRPUNUN9ESeA8Yl0ToLmzqFNPiexPv5PNRM9sde0SNxEhSs4q-vWckM/s1600/nifty-3.PNG" height="191" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Stochastics & TRIX</td></tr>
</tbody></table>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
Foreign Institutional Investors (FII's) have started buying in the markets after an initial brief bout of selling.Last trading sessions derivatives data from NSE states Index Futures buying of Rs.546 crore.</div>
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<br /></div>
<div style="text-align: justify;">
In coming days,we expect Nifty moving higher towards 6220 and 6300 levels.Hence,we can go long in Nifty near 6080-6090 levels for target of 6220 and 6300 with a stoploss at 5970(spot level).</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-22528636151627760212013-11-29T22:42:00.002-08:002013-11-30T22:24:11.571-08:00Equity Systematic Investment Plan ( ESIP ) - Intelligent way of stock accumulation<div dir="ltr" style="text-align: left;" trbidi="on">
<div style="text-align: justify;">
<a href="http://trading-technicals.blogspot.in/2013/11/sip.html">Systematic Investment Plan</a> ( SIP ) remained very popular and successful method of investment in Mutual Funds for long term investors.Taking inspiration from SIP, the leading stock brokers have started providing similar option to investors for stock accumulation.This is known as Equity Systematic Plan ( ESIP ) or Systematic Equity Plan ( SEP ).</div>
<div style="text-align: justify;">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh6AFT5ayDeHkeyLl903IV2-l53VBjD_zxb5jnrH4gJMK3mwwLeCu9ao1FmiVZpmYstd4hpn8uwHAnBubNy1dZYfWlW7ggQTlZGkKgHg5gg_z3NR5gQItoULJxzig2XXT5Q0i5aGn_dA7g/s1600/esip.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh6AFT5ayDeHkeyLl903IV2-l53VBjD_zxb5jnrH4gJMK3mwwLeCu9ao1FmiVZpmYstd4hpn8uwHAnBubNy1dZYfWlW7ggQTlZGkKgHg5gg_z3NR5gQItoULJxzig2XXT5Q0i5aGn_dA7g/s1600/esip.PNG" height="152" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Equity Systematic Investment Plan ( ESIP )</td></tr>
</tbody></table>
<br /></div>
<div style="text-align: justify;">
We all know it is always risky to invest in stock market.An investor willing to buy stocks wants to enter in the stock at a fair price so as to minimize his risk and maximize the returns<br />
<a name='more'></a>.So he keeps on waiting for optimum levels on the market to enter.The fact is that you can never time the market perfectly.So you may or may not get your desired levels to buy the stock.Sometime markets just run away and you just keep on having grudge that you missed the bus.On the other side,you get your desired levels and buy the stock but the market keeps on sliding,throwing the shivers through the body.</div>
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<br /></div>
<div style="text-align: justify;">
ESIP or SEPs help to remove these hindrances in the path of investment of an Investor.This plan works similar to the <a href="http://trading-technicals.blogspot.in/2013/11/sip.html">SIP</a> except that in ESIP you keep on buying your chosen stock in a predefined quantity or amount on a predefined time interval instead of buying units in SIP.</div>
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<br /></div>
<div style="text-align: justify;">
By opting for ESIP,you remove the need to time the market.You keep on buying a stock irrespective of price fluctuations and over a time period,you see that your buying price gets averaged.So sharp market movements don't impact you and your portfolio much.Moreover,you start taking market exposure without waiting for market correction.Just allocate the capital you want to invest,choose a good stock with strong fundamentals and select the quantity and time interval and start investing regularly.</div>
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<br /></div>
<div style="text-align: justify;">
So consult your stock broker for ESIP and build a portfolio of blue chip stocks in a systematic way to reap the rewards of market moves over the longer period of time.</div>
<br /></div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com1tag:blogger.com,1999:blog-1358923570617434806.post-66768030027683111342013-11-29T09:48:00.002-08:002013-12-06T19:15:15.824-08:00How to be a Successful Trader in Stock Market<div dir="ltr" style="text-align: left;" trbidi="on">
<div style="text-align: justify;">
Trading in Stock Market is a highly rewarding business.Lot of people start trading ,thinking of making quick money but end up loosing.It is a fact that 80 % traders loose money,only 20 % make it big when it comes to stock markets.My purpose of writing this is not to dishearten or discourage you of trading.There are certain basic things about trading which if followed strictly may help you to shift into the category of 20 % lucky people.</div>
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</div>
<div style="text-align: justify;">
You should always remember that these 20 % folks are not any extraordinary people.<br />
<a name='more'></a>They also make mistakes,their trades also go wrong but the Trade Plan and the rules make them extraordinary.Let's take a look at these basics :-</div>
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<br /></div>
<div style="text-align: justify;">
1.<b> Approach</b> - Trading is not a game.Take it as a Business.After all you are putting your money at stake and you would never want to lose it like that.So be serious and professional in your approach towards trading.</div>
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<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjQWaO7F-nlWYPK6H6O0vY3hhUY-iSJe7gc9hBaAjgkFFIuN5r1-qqQElYLaKCKpfQib-xD5HGgd-mmt-CLDJaewpgYtPnbUhRaRfzGe1-J_4N3ulDYLHgARaP2ksQ4USRar-hcDRyGU9Q/s1600/HAHAHAHAHAHAHAHAHAHAHAHAHAHAH.PNG" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjQWaO7F-nlWYPK6H6O0vY3hhUY-iSJe7gc9hBaAjgkFFIuN5r1-qqQElYLaKCKpfQib-xD5HGgd-mmt-CLDJaewpgYtPnbUhRaRfzGe1-J_4N3ulDYLHgARaP2ksQ4USRar-hcDRyGU9Q/s1600/HAHAHAHAHAHAHAHAHAHAHAHAHAHAH.PNG" width="261" /></a></div>
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<div style="text-align: justify;">
2. <b>Sufficient Capital</b> - Some traders enter in to a trade without sufficient capital.So when it comes to managing a trade in case of unfavourable market move,they have already exhausted their capital.They are left with no other option than to exit with loss.Trading should always be done by sufficient capital and the cash you don't need urgently or you can afford to loose.</div>
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<br /></div>
<div style="text-align: justify;">
3. <b>Trading Plan</b> - Before entering a trade,you should have prepared your trading plan.You should be aware of your entry price,exit price in case of unfavourable market move and target price for the trade.It is always better if you write down your trading plan on a paper.A written plan eliminates the possibility of deviating from the plan.</div>
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<br /></div>
<div style="text-align: justify;">
4. <b>Charting Software</b>- to prepare a trading plan,you need a charting software for <a href="http://trading-technicals.blogspot.in/2013/10/technical-analysis.html">technical analysis</a>.With the help of chart reading,you shall be able to find the entry price,stoploss price price and the target price.So make sure to have a good quality charting software available to you and follow the charting patterns.The real work starts when the market is closed.That is the time you prepare a plan.On the opening of the market,you are there only to implement it.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
5. <b>Keep Emotions Away</b> - Two human <a href="http://howtobuystocks.blogspot.in/2013/11/understanding-fear-hope-greed-and.html">emotions</a> are the biggest enemy to the success of a trader-Greed when you are going into a profit and Fear when the trade is going against you.A proper trading plan followed strictly helps to control these emotions.Exit the trade when your target has been achieved or you have made enough money on the trade.Keep strict stoploss in case of adverse market move and exit without waiting for the market reversal.Market may or may not reverse.Once your stoploss is triggered,you should be out of the trade even if price again comes above that level.</div>
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<br /></div>
<div style="text-align: justify;">
6. <b>Capital Protection </b>- This should be the top most priority of a market trader.Letting the losses piling up in hope of market reversal will erode your capital.Respect the market.Cut short losses by following strict stoploss and book reasonable profits in case you have.if you keep your capital protected , you can get profit in next trade.</div>
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<br /></div>
<div style="text-align: justify;">
7. <b>Avoid Overtrading </b>- Mere buying and selling is not trading.Enter a trade only if you see opportunity of making enough money that it covers your brokerage charges and is worth risk taking,Trades worth risk taking have risk to reward ratio of 1:3 or 1:4.Remember,you are putting your hard earned money on risk.It is always better to fix the number of trades you want to make in a day,week or month according to your risk profile.Stick to that irrespective of you make or loose money.</div>
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<div style="text-align: justify;">
8<b>. Avoid Trading Tips</b> - You should avoid the trading tips you may get by SMS or email or anything like that.Only you by yourself know your risk profile.The person giving you tips does not know your risk profile.So,learn <a href="http://letting%20the%20losses%20piling%20up%20in%20hope%20of%20market%20reveresal%20will%20erode%20your%20capital./">technical analysis</a> and chart reading by your self if you want to be a professional trader.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
9. <b>Quantity or Volume</b>- Trade the quantity only you are comfortable in holding or as per your risk profile.A large quantity trade going against you may trigger emotions which are always harmful to a trader.</div>
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<br /></div>
<div style="text-align: justify;">
10.<b> Patience </b>- This little word is very powerful when trading in market.Never be in hurry to jump into a trade.Wait patiently when your desired price is away.Don't think that it will run away.Little patience can give you a better entry and exit price.Avoid trading in first and last half an hour of a trading day.During this time,volumes are usually high and moves are sharp and markets are in the hangover of previous day's moves and news.Let the market cool off for an hour or two after opening.<br />
<br />
Another point of significant importance along with the above mentioned rules is that you always identify and follow the market trend.Don't attempt to fight the trend.The advantage of going with the trend is that even if you could not make accurate entry into the trade, the chances of going to into lossed reduce significantly than otherwise. The mantra to a successful trade is Follow The Trend. Always remember :-<br />
<br />
<b>" Trend is Your Friend "</b><br />
<br /></div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com4tag:blogger.com,1999:blog-1358923570617434806.post-72288325955031523592013-11-24T06:18:00.002-08:002013-11-24T06:19:07.519-08:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="separator" style="clear: both; text-align: center;">
</div>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgnA4qhx_-o79fsWYhPE58CSDcAV9wuX9sJKhRvHkeQ03RSKT68j-FK3dPB3I5O5ZiS23Xh5o-8BXs8xuHhnOtgXSPogHst3OqMcEYlo0tyQmDYy0Z6C2bi-fb8hGCfAGuHc1nyFbNmjig/s1600/Capturenewww.PNG" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgnA4qhx_-o79fsWYhPE58CSDcAV9wuX9sJKhRvHkeQ03RSKT68j-FK3dPB3I5O5ZiS23Xh5o-8BXs8xuHhnOtgXSPogHst3OqMcEYlo0tyQmDYy0Z6C2bi-fb8hGCfAGuHc1nyFbNmjig/s1600/Capturenewww.PNG" height="199" width="320" /></a></div>
<div style="text-align: justify;">
In our last post on NIFTY outlook,we expected Nifty to move higher towards 6150 and 6200 for retracement of 50-62% of the 350 point decline on the back of short covering.Nifty did that and went above 6200 but could not sustain there.Fed tapering news provided the excuse for the profit booking and Nifty fell towards 5975</div>
<a name='more'></a>before closing near 6000,the area of highest open interest for Put strike.<br />
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<br /></div>
<div style="text-align: justify;">
Now ,Nifty momentum is clearly downwards with short-term indicators also pointing selling pressure.Most sensitive leading indicator RSI or Relative Strength Index has not shown any reversal.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
According to last trading day's FII's data from NSE, FII's bought Index futures worth ₹ 55 crore and bought index options worth ₹ 475 crore.</div>
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<br /></div>
<div style="text-align: justify;">
In the coming days,Nifty is likely to trade between 6040 and 5900 with downward bias in this expiry week.Short-term traders can trade short on bounce towards 6040 for target of 5975 and 5900 keeping stoploss at 6060 ( spot level ).</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-51148810806835637212013-11-23T21:44:00.001-08:002013-11-23T21:44:09.604-08:00Understanding the CANDLESTICKS in a candlestick chart<div dir="ltr" style="text-align: left;" trbidi="on">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiIMRf2ajUrzw0CqMqhHF9bIKXMm96q0jTxhgVkwvSY2E4cVa48UzN8-kj2qxuCqvFj0VbROsK6lEmlUajsD8w01jmrh4ehO2Zq6MJH_uybMkMV0Xhh1HER0h2QhBG7FAIYFyEAof46rp8/s1600/candless.PNG" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiIMRf2ajUrzw0CqMqhHF9bIKXMm96q0jTxhgVkwvSY2E4cVa48UzN8-kj2qxuCqvFj0VbROsK6lEmlUajsD8w01jmrh4ehO2Zq6MJH_uybMkMV0Xhh1HER0h2QhBG7FAIYFyEAof46rp8/s1600/candless.PNG" /></a><br />
<div style="text-align: justify;">
Candlestick charts make an extremely important part in the arsenal of a technical analyst.Although there are other types of charts also available like line,mountain and OHLC charts but the information Candlestick charts provide about a security earns them a special place in the technical analysis arena.</div>
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<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
Candlestick charts originated in Japan,hence popularly called as Japanese Candlestick Charts.</div>
<a name='more'></a>These charts consist of combination of Candles plotted on a graph. A candlestick depicts the behavior of a security in a specific time frame.In a daily Candlestick Chart,a single candle shall show the behavior of the security in a single day of trading.Likewise,we can select candlesticks for hourly,weekly,monthly or yearly time frames.<br />
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
<b>What is a Candlestick ?</b></div>
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<br /></div>
<div style="text-align: justify;">
If you see a candlestick chart,you will find that a typical candlestick consists of a middle thick body and two shadows-on the upper and the lower end of the body ( see the figure ).The whole length of the candle shows the entire price range of the security in a particular time frame.Here we talk of a candle formed by single trading session movement of the security/stock.</div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; margin-right: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiXyrEM6VwLmJE09LeIzY7vXaIbR0PzHBF5xIKN6wSOGTZgzGfg-ScQIe4NLRu81ti_dy8VxuZ9lQ0xzFYtTotrBte2GiXCkRUMLZbElYaFSrlwokXQoYH8k8QsszhWIksjQ7gaZ12L9To/s1600/green+candle.PNG" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiXyrEM6VwLmJE09LeIzY7vXaIbR0PzHBF5xIKN6wSOGTZgzGfg-ScQIe4NLRu81ti_dy8VxuZ9lQ0xzFYtTotrBte2GiXCkRUMLZbElYaFSrlwokXQoYH8k8QsszhWIksjQ7gaZ12L9To/s1600/green+candle.PNG" height="153" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Bullish Candlestick</td></tr>
</tbody></table>
<div style="text-align: justify;">
When the market opens,the stock also opens at a particular price level.This is the first traded price of the stock and it leads to the formation of the lower end of the body of the candlestick ( green portion ).After that ,the stock touches the highest and the lowest price of the day which is represented by the upper and lower shadow respectively,before closing at a higher price which is represented by the upper end of the body of the candle.</div>
<div style="text-align: justify;">
<br /></div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBoGDTcKrv5EQ7-W4DtajeHyHo7O_twzDwzbxSGpHWnw9M1vvthlu1kvRR1nAEBdhTT-sTx3Sv4ijY4ShpV-y0wJxNhHf0sGyct701A0gVdoktqykPYjxLBwnPs_NUuDW6xUNReZJlEO0/s1600/red+candle.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhBoGDTcKrv5EQ7-W4DtajeHyHo7O_twzDwzbxSGpHWnw9M1vvthlu1kvRR1nAEBdhTT-sTx3Sv4ijY4ShpV-y0wJxNhHf0sGyct701A0gVdoktqykPYjxLBwnPs_NUuDW6xUNReZJlEO0/s1600/red+candle.PNG" height="148" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Bearish Candlestick</td></tr>
</tbody></table>
<div style="text-align: justify;">
When a stock opens at a lower price and closes at a higher price at the end of the day,it makes a green candle on the daily candlestick chart.Some charting software represent the green candle by blue colour.All in all,these candles make bullish candles.It means that stock prices have moved higher at the end of the day.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
If a stock opens at higher price level in the morning and after making highs and lows closes at lower price level than the opening price,a red candlestick is formed on the candlestick chart.This is called a bearish candle and it indicates that the price of the stock has moved lower in the trading session.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
<b>How candlesticks are important to a trader ?</b></div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
A candlestick in itself explains the behaviour of the majority of the traders and thus provides cues to a trader in taking trading decisions.</div>
<div style="text-align: justify;">
A green candle with a large body and short shadows indicates that buyers are very aggressive in that particular stock.</div>
<div style="text-align: justify;">
Similarly,a large body red candle with small or no shadow indicates that sellers are dominating in the particular script.</div>
<div style="text-align: justify;">
A candle with small body and large shadows on upper and lower end depicts indecision in the minds of traders</div>
<div style="text-align: justify;">
long shadow on the upper end shows that stock moved higher but could not sustain there and closed at lower price.Thus it indicates resistance at higher levels.</div>
<div style="text-align: justify;">
Similarly,long shadow at lower end depicts that after touching lows for the day,stock moved up and closed above the lows.S it indicates that buying support is there at lower levels.Hence stock can be considered for buying for short-term trading.</div>
<div style="text-align: justify;">
These different formations of the candlesticks lead to formation of short-term patterns like Doji,Shooting star,Hammer,Bar reversal patterns and many more which we shall discuss in our next articles.</div>
<div style="text-align: justify;">
<br /></div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-18549032594842462132013-11-16T05:01:00.001-08:002013-11-16T05:01:59.041-08:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
<div class="separator" style="clear: both; text-align: center;">
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<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg7B1yo-h8xocTN2ShLtB-99bAk4xZA9k7_2WxuUz7f_WeFVlCkoXArrq8y39iqoU21bon4XQsW_yGkwcAKTgEk4MHCy3FJXTLK3MgL9IPtosMwqBavOuTkIFZzvi4O9PDT-CVwyC9-Wqg/s1600/NNNNNNNNNN.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="145" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg7B1yo-h8xocTN2ShLtB-99bAk4xZA9k7_2WxuUz7f_WeFVlCkoXArrq8y39iqoU21bon4XQsW_yGkwcAKTgEk4MHCy3FJXTLK3MgL9IPtosMwqBavOuTkIFZzvi4O9PDT-CVwyC9-Wqg/s1600/NNNNNNNNNN.PNG" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty Daily Chart-Retracement lines</td></tr>
</tbody></table>
In our <a href="http://trading-technicals.blogspot.in/2013/11/outlook-for-nifty-for-coming-trading_10.html">last post</a> on NIFTY outlook,we mentioned targets of 6040 and 5980 on the lower side.Continuing the downtrend,Nifty fell in 8 sessions on the trot.Breaching the first support of 6040,Nifty went up to 5975,the next major support.From these levels ,Nifty bounced back and closed above 6050 in the last trading session supported by short covering.<br />
<a name='more'></a></div>
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<div style="text-align: justify;">
In the entire down move,Nifty lost about 350 points and went into oversold territory.Hence a sharp up move was due.Highest Call Option Open Interest at 6000 strike and strong technical support of 5975-5980 along with positive global markets provided the reason for bounce back.</div>
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<br /></div>
<div style="text-align: justify;">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; text-align: left;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh8qIQ0DpMQCcHm6a2szpAy4euD3TM10L80D_tC-sM_CDXsP2Rlabvx3U1FdhKH4WYMMbozOF06v8944pp6FVMWiKbrtsu12-95133vwoha3eU4aHGA5cbPxlV6RRYXvPOgc7NMyFTBLA8/s1600/NNNNMMMMMMMM.PNG" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="145" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh8qIQ0DpMQCcHm6a2szpAy4euD3TM10L80D_tC-sM_CDXsP2Rlabvx3U1FdhKH4WYMMbozOF06v8944pp6FVMWiKbrtsu12-95133vwoha3eU4aHGA5cbPxlV6RRYXvPOgc7NMyFTBLA8/s1600/NNNNMMMMMMMM.PNG" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty-Stochastics & RSI</td></tr>
</tbody></table>
The 38 % Retracement line of the entire 350 points decline lies at 6114 while 50% Retracement is at 6156 which may act as resistance to the Index on the upside.</div>
<div style="text-align: justify;">
In last trading session,FII's bought Index Futures worth ₹ 115 crore and bought Index Options worth ₹ 440 crore which is somewhat positive for the market.Leading Indicators Stochastics and Relative Strength Index ( RSI ) are showing positive crossover on the daily chart.</div>
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<br /></div>
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In the coming sessions,we expect Nifty to trade higher towards 6150.The support is at 5970-5980.So, short-term traders can play Nifty with positive bias near 6000 levels for higher targets of 6150-6200 ( spot levels ).<br />
[ source of images;<a href="http://www.icicidirect.com/">www.icicidirect.com</a> ]<br />
<br /></div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-25638080557230199272013-11-10T10:29:00.000-08:002013-11-10T10:29:02.127-08:00Yes Bank-A very short-term selling opportunity<div dir="ltr" style="text-align: left;" trbidi="on">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhmWqkEcia7tVOpG_9q2YaJaOHrGOiQgn9S5C2G0YtiI6jlIGCBMGquaSii6PeEZSfqN-nifk0wgT6TIdQTxMugovfzmdqs_N8BV5koNCwUESXDA5-aOh7afJHC97o-k3G4ZDP5G9-mN8c/s1600/YESBANK.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhmWqkEcia7tVOpG_9q2YaJaOHrGOiQgn9S5C2G0YtiI6jlIGCBMGquaSii6PeEZSfqN-nifk0wgT6TIdQTxMugovfzmdqs_N8BV5koNCwUESXDA5-aOh7afJHC97o-k3G4ZDP5G9-mN8c/s1600/YESBANK.PNG" height="320" width="262" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Yes Bank-Daily Chart<br />
source: www.icicidirect.com</td></tr>
</tbody></table>
<div style="text-align: justify;">
During the last few days,markets has seen profit booking after the steep rise.The fall is lead mainly by the banking index.Several banking heavyweights have broken the important support levels in this fall and are offering shorting opportunities.</div>
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<br /></div>
<div style="text-align: justify;">
Yes Bank is also one such stock which has broken down from the Wedge pattern in last trading session</div>
<a name='more'></a>( see fig ). Momentum oscillators are negative indicating the downward momentum in the stock.<br />
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<br /></div>
<div style="text-align: justify;">
From very short-term prospective of 4-5 trading sessions,we expect Yes bank to hit levels of 310-320 below 365 .So short positions can be taken accordingly taking stop loss above 385.</div>
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<br /></div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-19630946406542308672013-11-10T05:19:00.001-08:002013-11-10T05:19:57.471-08:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjurGDISTjMNHa_PHLnDDzjkAbzEt9851EyDR4T4987rp0Z5PCcXc9ju03jTR-tPsMox73F_Rny_VVzGWMol0rGWCq_pc-SNIhdzTS1587DbT4HBf6RjmUwjxuM1Cp6lAVKlkalhC3nxLA/s1600/NMN.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjurGDISTjMNHa_PHLnDDzjkAbzEt9851EyDR4T4987rp0Z5PCcXc9ju03jTR-tPsMox73F_Rny_VVzGWMol0rGWCq_pc-SNIhdzTS1587DbT4HBf6RjmUwjxuM1Cp6lAVKlkalhC3nxLA/s1600/NMN.PNG" height="176" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty Daily Chart<br />
( source : <a href="http://icicidirect.com/">icicidirect.com</a> )</td></tr>
</tbody></table>
<div style="text-align: justify;">
In our last post on Nifty Outlook, we expected targets of 6350 and 6400 for NIFTY on the basis of strong upward momentum in the market backed by strong FII's flows.Nifty,however,after testing 6300 odd levels faced profit booking and was dragged down towards lower support levels and closed at 6140 on weekly basis.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
On the daily chart,Nifty breached and closed below the neckline ( yellow line ) of the <a href="http://trading-technicals.blogspot.in/2013/10/inverse-head-shoulder-pattern.html">Inverse Head & Shoulder Pattern</a><br />
<a name='more'></a>which was placed at 6170-6180 levels and was a good support for the index.In the process,it closed below the rising <a href="http://trading-technicals.blogspot.in/2013/10/what-is-trendline-and-its-significance.html">trendline</a> ( blue line ) indicating the short term bearish trend.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
The short term leading indicators, the stochastics ( middle graph ) and the TRIX ( Triple Moving Average Crossover;lower graph ) have turned negative on the daily chart.On weekly chart too,Nifty is in overbought area and is pending for a correction with momentum oscillators turning negative.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
In Friday's session,FII's sold Index Futures of worth Rs 1087 and bought index options of worth Rs 668 indicating bearish mode of Foreign Institutions on the markets.</div>
<div style="text-align: justify;">
<br /></div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjoR7GsZzs_tbBSogx20sKikTtylqTbx0laQDm5qEphCP9FDFOy7L-nNeq4HRHQaav9PJ_I3aMCzUfWb9P9K60F6-bPtA1HqqsZ40sV_pNjxnHubBB8q_48nOFdbL1wg6ZxLZkGl0fOKPk/s1600/noch.PNG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjoR7GsZzs_tbBSogx20sKikTtylqTbx0laQDm5qEphCP9FDFOy7L-nNeq4HRHQaav9PJ_I3aMCzUfWb9P9K60F6-bPtA1HqqsZ40sV_pNjxnHubBB8q_48nOFdbL1wg6ZxLZkGl0fOKPk/s1600/noch.PNG" height="131" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><a href="http://www.nseindia.com/live_market/dynaContent/live_watch/option_chain/optionKeys.jsp?symbolCode=-10006&symbol=NIFTY&symbol=NIFTY&instrument=-&date=-&segmentLink=17&symbolCount=2&segmentLink=17">Nifty Option Chain</a><br />
( source : National Stock Exchange-NSE )</td></tr>
</tbody></table>
<div style="text-align: justify;">
On the options side,the highest open interest for the Nifty Call option ( left red oval ) has shifted to 6300 from 6400,thus lowering the upper ceiling for the market.The highest open interest for the Nifty Put option ( right red oval ) lies at 6000 which may provide support to the market on lower side.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
Looking at the overall scenario,we expect Nifty to trend lower as long as it stays below 6180 on closing basis.Hence,short positions can be taken in Nifty below 6180 levels for lower support targets of 6040 and 5980 keeping a stop loss at 6230 levels ( spot levels ) .</div>
<div style="text-align: justify;">
<br /></div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-64878875733055214052013-11-09T22:05:00.000-08:002013-11-29T22:50:21.914-08:00Systematic Investment Plan ( SIP )<div dir="ltr" style="text-align: left;" trbidi="on">
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<div style="text-align: justify;">
Almost everyone of us has some goal or ambition in our life which we plan to achieve,for some it can be buying a house or a car at some point of time in future,for others it can be children's education or marriage or their own retirement planning or financial independence.All these goals require huge sums of money to be take care of.</div>
<br />
<div style="text-align: justify;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj-ceKeGf32JkiA8Iwxb4lYbaI09CP_izUy766U_fKv7GLkTcLTjnw3b55FzucHrosGn2beZ0WslwNZjRRuauzGdkizTiFtr8_brnQaCnpF4wIVeuakzUHYR99hSeyzS6ElCU4vG6qBJ-Q/s1600/sip.PNG" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em; text-align: justify;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj-ceKeGf32JkiA8Iwxb4lYbaI09CP_izUy766U_fKv7GLkTcLTjnw3b55FzucHrosGn2beZ0WslwNZjRRuauzGdkizTiFtr8_brnQaCnpF4wIVeuakzUHYR99hSeyzS6ElCU4vG6qBJ-Q/s1600/sip.PNG" /></a>Now,everyone has goals but unfortunately very few of us are aware of the tools available to achieve these goals.To accomplish these goals requires very careful planning and discipline<br />
<a name='more'></a><br />
<a href="https://www.blogger.com/blogger.g?blogID=1358923570617434806" name="more"></a>on the part of the person.Systematic Investment Plan or SIP as popularly it is called is one such tool which can be very beneficial to achieve your goal of wealth creation.</div>
<br />
<div style="text-align: justify;">
<br /></div>
</div>
<div dir="ltr">
<div style="text-align: justify;">
<b>What is SIP?</b></div>
<div style="text-align: justify;">
<b><br /></b></div>
</div>
<div dir="ltr">
<div style="text-align: justify;">
Systematic Investment Plan (SIP) is the method of investment in stock market through Mutual Fund or Stock Investing route in predefined installments on regular fixed intervals over a defined time period.</div>
<div style="text-align: justify;">
Investment intervals can be taken anything from daily,weekly,fortnightly,monthly or quarterly as per individual requirements.Similarly,installment of the amount to be invested can be selected as per comfort of the investor.Usually,there is some lowest amount fixed by each company which the investor can opt to invest and there are multiples of that installment which can be chosen for investment.</div>
<div style="text-align: justify;">
Let us take an example.Suppose a person X wishes to invest Rs.4000 per month in a mutual fund for the next 5 years.He shall choose a good quality mutual fund for SIP investment.He can have the option to invest the amount either Rs 4000 monthly or Rs 1000 weekly or Rs 2000 fortnightly for the next 5 years.</div>
<div style="text-align: justify;">
<br /></div>
</div>
<div dir="ltr">
<div style="text-align: justify;">
<b>How SIPs work?</b></div>
<div style="text-align: justify;">
<b><br /></b></div>
</div>
<div dir="ltr">
<div style="text-align: justify;">
SIPs are considered best investment tool for those people who have not much knowledge of stock markets or who can not actively track the markets but yet want the exposure of the market to grow their investment. </div>
<div style="text-align: justify;">
Mutual funds remain the very good option to start a SIP for these people.Here,professional fund managers hired by the mutual fund companies do the work of managing the portfolios,the investor just needs to invest in the fund.</div>
<div style="text-align: justify;">
Each mutual fund scheme has a NAV or Net Asset Value which moves with the markets just like the price moves in the stocks but the movement in the fund is not as dynamic as in the stocks.When you opt for a SIP, you buy the mutual funds at the NAV price available on the date of buying and Units are allotted to your portfolio. When the markets are moving higher ,the NAV of the fund rises and you get less Units and when the markets are moving lower the NAV falls which results in more number of Units allotted. In this way,your buying gets averaged over the time period.</div>
<div style="text-align: justify;">
SIPs has the potential to yield 12% plus returns in the longer investment horizons though being a market dependent instrument, the returns depend how the markets behave over that period of time.</div>
<div style="text-align: justify;">
<br /></div>
</div>
<div dir="ltr">
<div style="text-align: justify;">
<b>The early you start,the better it is:</b></div>
<div style="text-align: justify;">
<b><br /></b></div>
</div>
<div dir="ltr">
<div style="text-align: justify;">
An individual should start investing as early as possible to yield best results from the SIP.The younger you start,the better are the probability of reaching towards your goal of wealth creation.</div>
<div style="text-align: justify;">
The real power of SIP lies in the Time horizon you devote for investing.The compounding factor also comes into play when the period of investment is longer.Let's explain with an example:-</div>
<div style="text-align: justify;">
Suppose there are two persons,Bobin and Stephan which are employed and want to retire at 55 years of age.Currently,Bobin is 25 years and Stephan is 35 years old.Both want to have a corpus of Rs.1 crore ( 10 million ) at their retirement to enjoy their post retirement period.</div>
<div style="text-align: justify;">
They start investing via SIP route in a mutual fund which is expected to provide a return of 12% over that time horizon.Now Bobin have 30 years and Stephan have 20 years to accomplish the goal.To reach the goal of Rs 1 crore,Stephan needs to invest Rs 10,109 per month for the next 20 years while Stephan needs only Rs 2861 to be invested every month for the next 30 years.</div>
<div style="text-align: justify;">
In this process,if we calculate the amounts invested by them up to their retirement,we find that Stephan ends up investing Rs 24,26,160 while Bobin had to invest only Rs.10,29,960 to reach the same goal of Rs 1 crore.So starting late investment for his retirement costs Stephan almost 2.5 times than that of Bobin.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
<b>How to plan for a Goal?</b></div>
<div style="text-align: justify;">
<b><br /></b>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
Before starting a SIP,define your Goal.This is very important.Only after have decoded your Goal,you can choose the amount you need to invest and time period required for that investment.</div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
There are several types of <a href="http://mutualfund.birlasunlife.com/UploadDocuments/Money-Wheel-SIP-Calculator/index.html">SIP Calculators</a> available which help you to calculate the monthly investment required to reach the Goal or the target amount you can accumulate by investing an amount fixed by you for a particular period of time.</div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
After you have planned everything,then you have follow it in disciplined manner.Keep investing every month or week whatever interval you have chosen.</div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
<br /></div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
<b>Advantages of SIP Investment:</b></div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
<br /></div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
-No need to time the market.By SIP,you continue to invest irrespective of the market levels.You buy more when markets are falling and buy less when markets are rising ,giving you the benefit of Rupee cost averaging over the longer period.</div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
-Makes you disciplined towards your investment and goal achievement.</div>
</div>
<div style="text-align: left;">
<div style="text-align: justify;">
-Risk of market movements is minimized by rupee cost averaging.</div>
<div style="text-align: justify;">
-You need not to invest in lump sums.Small regular investments do the trick.</div>
<div style="text-align: justify;">
-Helps in accumulation of wealth over the longer time horizons by compounding factor.<br />
<br />
You may also like <a href="http://trading-technicals.blogspot.in/2013/11/equity-sysytematic-investment-plan-esip.html">Equity Systematic Investment Plan ( ESIP ) or Systematic Equity Plan ( SEP )</a></div>
</div>
</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-81707321291916064762013-11-05T07:42:00.001-08:002013-11-05T07:42:36.901-08:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi29QW9bfQ_S4ZXqwq3zEtZp75BuFKFeLWoUsZqVQ1ecVCu3YGGON0pHaFcq0s4QZOrI8oONfAdLERpPJKPuPdbRLgXSQEafz_j4c96MpvZEByeuhW75lMcvXQrj2n5tVBfH4f2UFH6pKQ/s1600/NIFF.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi29QW9bfQ_S4ZXqwq3zEtZp75BuFKFeLWoUsZqVQ1ecVCu3YGGON0pHaFcq0s4QZOrI8oONfAdLERpPJKPuPdbRLgXSQEafz_j4c96MpvZEByeuhW75lMcvXQrj2n5tVBfH4f2UFH6pKQ/s1600/NIFF.PNG" height="135" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty Daily Chart<br />
(source:<a href="http://www.icicidirect.com/">www.icicidirect.com</a> )</td></tr>
</tbody></table>
<div style="text-align: justify;">
Nifty is continuing its uptrend on the back of strong up move in large cap heavyweights after breakout above the neckline of the <a href="http://trading-technicals.blogspot.in/2013/10/inverse-head-shoulder-pattern.html">Inverse Head & Shoulder Pattern</a> and continuously trading above the neckline.FII's are on continuous buying spree.<br />
<a name='more'></a></div>
<div style="text-align: justify;">
Seeing the strong upward momentum in the market,Nifty is expected to climb to higher levels towards all time highs of 6357 and 6400 where the highest open interest for the call option lies.On the lower side,6175-6180 is expected to provide support in case profit booking happens.</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-40295260357072206302013-10-31T09:44:00.003-07:002013-11-01T00:04:43.015-07:00Options Trading –What are Options?<div dir="ltr" style="text-align: left;" trbidi="on">
<blockquote>
<div style="text-align: justify;">
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.<br />
<a name='more'></a></div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh7ZLsDPdxfxOCd2NSH1_Gfm7fBApVLau9aTpYuxGg18TuGQx-3Dc8tkugfsZtT3auyY2BLWLs2WpyOBK_kqV7M09V9jxjcvQP7X5Y37p2q3kCHmg_dJlOBxuoM1hRDG6StGl-zTmueTFw/s1600/FC.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh7ZLsDPdxfxOCd2NSH1_Gfm7fBApVLau9aTpYuxGg18TuGQx-3Dc8tkugfsZtT3auyY2BLWLs2WpyOBK_kqV7M09V9jxjcvQP7X5Y37p2q3kCHmg_dJlOBxuoM1hRDG6StGl-zTmueTFw/s1600/FC.PNG" height="227" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Flow Chart-Futures & Options ( F& O )</td></tr>
</tbody></table>
<div style="text-align: justify;">
In markets,you trade in two segments;either in Cash or in Futures & Options (F&O). F&O segment operates in monthly contracts.These contracts remain valid for a month and do expire in last week of the month on a day as determined by the concerned stock exchange..</div>
</blockquote>
<div style="text-align: justify;">
<br /></div>
<blockquote>
<div style="text-align: justify;">
<b>What is an Option ?</b></div>
</blockquote>
<div style="text-align: justify;">
<br /></div>
<blockquote>
<div style="text-align: justify;">
By definition, an Option is a contract which gives the buyer or the seller the right but not the obligation to buy or sell the underlying for that contract. at a specific time and at a specific price.The amount given to buy this contract is called the Premium.The buyer is not bound to buy the underlying in that period and he/she may let the contract to expire .In this way,he/she has to loose all the premium paid to acquire the contract.Other alternative is that the person squares of his/her position by selling that contract in the market .The difference of the selling price and the buying price of that contract is returned to him/her.</div>
<div style="text-align: justify;">
Types of Options :-</div>
<div style="text-align: justify;">
Options are of two types-</div>
<div style="text-align: justify;">
1.Call Option</div>
</blockquote>
<div style="text-align: justify;">
<br /></div>
<blockquote>
<div style="text-align: justify;">
2.Put Option</div>
</blockquote>
<div style="text-align: justify;">
<br /></div>
<blockquote>
<div style="text-align: justify;">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiEpAnVLwhUTtFYOH0zZrDDso87D1JuMeTZpSac9WlSvtf1IZ0TGxEL-HHU4-TtttqRi35Jpe-IctIAK5Kg_NoQejaZ1IyR5mC0H2B3p3WPfoAWLwPzsd5AJlCPWMwWueYllp3QlrhtBmA/s1600/INFYCH.PNG" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiEpAnVLwhUTtFYOH0zZrDDso87D1JuMeTZpSac9WlSvtf1IZ0TGxEL-HHU4-TtttqRi35Jpe-IctIAK5Kg_NoQejaZ1IyR5mC0H2B3p3WPfoAWLwPzsd5AJlCPWMwWueYllp3QlrhtBmA/s1600/INFYCH.PNG" height="184" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Option Strikes Of Infosys</td></tr>
</tbody></table>
<b>Call Option</b>-Call option is defined as the option to buy the underlying at or before the fixed time and at a fixed price.When we anticipate price rise in an asset,we simply buy a Call Option.The amount paid to buy an option is called the <b>PREMIUM</b>.Suppose Infosys stock is trading at price of rs.3200 and we expect it to move towards 3300,we shall buy a Call Option of any strike available on the stock exchange.Let strikes of 3250 and 3300 are available,we can buy a call of 3250 or 3300.As the stock shall move towards 3300,the price of the Call shall increase,resulting in the profits.</div>
</blockquote>
<div style="text-align: justify;">
Selling a Put Option also constitutes bullish view but the difference here is that when you sell an Option,you have unlimited risk and the limited gain.We shall read in next article why a trader sells an Option even though he is at unlimited risk.</div>
<div style="text-align: justify;">
<b> Put Option</b> - Put Option is defined as the option to sell an underlying on or before the predefined time period and on a fixed price.When we expect the market or the underlying to fall in coming days,we simply buy a Put Option.As the price of the underlying decrease ,the price of the Option shall increase and resulting in profits to the trader.As in above example,If we expect Infosys to fall towards 3100,we shall buy 3150 or 3100 Put Option which shall increase in price when stock falls.<br />
Here again,selling a Call Option also constitutes the bearish view,but the risk is unlimited compared to returns which is limited.<br />
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjhrd9vMyBWlKyCNGxYY-3R6prJOFsDBPXz3TkLO4kasAGLoQf1wjmrdZxxemLiThJoKLaOGQfFl5dTw7WfCUcAkcObaC6iiJEUz9tryG4V-xUWVS46OC9UYclIgKDXT60STEFa9GDy46A/s1600/option+chain.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjhrd9vMyBWlKyCNGxYY-3R6prJOFsDBPXz3TkLO4kasAGLoQf1wjmrdZxxemLiThJoKLaOGQfFl5dTw7WfCUcAkcObaC6iiJEUz9tryG4V-xUWVS46OC9UYclIgKDXT60STEFa9GDy46A/s1600/option+chain.PNG" height="185" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Option Chain ( NSE )</td></tr>
</tbody></table>
<br />
All the strikes for a stock Options are given in the form of an <a href="http://www.nseindia.com/live_market/dynaContent/live_watch/option_chain/optionKeys.jsp?symbolCode=-10006&symbol=NIFTY&symbol=NIFTY&instrument=-&date=-&segmentLink=17&symbolCount=2&segmentLink=17">Option Chain</a> on the stock exchanges as in the following figure,we can see the Option Chain for Nifty given on the <a href="http://www.nseindia.com/index_nse.htm">National Stock Exchange ( NSE )</a> of India.The middle column shows the various strike prices available,their Last Traded Prices,bid and offer prices etc.<br />
There are some factors on which price of an Option depends and strategies to trade the Options which we shall read in the next article which shall be posted in coming days.</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-64679553092422811532013-10-29T23:41:00.001-07:002013-10-29T23:41:55.868-07:00Axis Bank ready for a bull run<div dir="ltr" style="text-align: left;" trbidi="on">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgqJtB4aXCvJF3TK8rIZqHEBMZShfR4ARYvvtUH57nwZ3WG55zZ8P1Iffr6NG7fuqtof7sKE4gC2hwhyphenhyphenioqasZlKKLVkfjeSJqGSE-p4so-U0Q2PeFRsObsJgbpaUrCN8fEn8oCbuiesCE/s1600/axis.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgqJtB4aXCvJF3TK8rIZqHEBMZShfR4ARYvvtUH57nwZ3WG55zZ8P1Iffr6NG7fuqtof7sKE4gC2hwhyphenhyphenioqasZlKKLVkfjeSJqGSE-p4so-U0Q2PeFRsObsJgbpaUrCN8fEn8oCbuiesCE/s1600/axis.PNG" height="233" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Axis Bank-Inverse H&S Pattern<br />
source:<a href="http://www.icicidirect.com/">www.icicidirect.com</a></td></tr>
</tbody></table>
<div style="text-align: justify;">
We saw in last few days and also discussed in our post on <a href="http://trading-technicals.blogspot.in/2013/10/outlook-for-nifty-for-coming-days.html">Nifty Outlook</a> 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.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
Banking stocks remained under pressure for quite some time due to adverse micro and macroeconomic factors but now the tide is turning <br />
<a name='more'></a>and major banking stocks have either reversed the trend to bullish mode or are on the verge of breakouts.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
Axis Bank is such one stock which broken out of <a href="http://trading-technicals.blogspot.in/2013/10/inverse-head-shoulder-pattern.html">Inverse Head and Shoulders Pattern</a> with good volumes.For the past few trading sessions the stock is trading above the neckline ( yellow <a href="http://trading-technicals.blogspot.in/2013/10/what-is-trendline-and-its-significance.html">trendline</a> ) and sustaining above that level,thus ruling out any possibility of false breakout.Head and Shoulders patterns are usually considered very powerful patterns by the technical analysts and there always lies the high probability of achieving the targets given by the pattern.</div>
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<br /></div>
<div style="text-align: justify;">
Now as the concerns for the banking stocks are diminishing and inflation also expected to come under 6% in coming 4-6 months,this will further fuel the rally in banking stocks including high betas like Axis Bank.Axis Bank is already considered a blue-chip stock in the market with strong fundamentals and a capable management.Risk with these kind of stocks remains limited.So we expect a good rally in the stock in the near future.</div>
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
Medium term traders or investors can consider taking positions in the stock in staggered manner near 1175 or on dips towards the 1000 levels (green <a href="http://trading-technicals.blogspot.in/2013/10/what-is-trendline-and-its-significance.html">trendline</a>) for targets of 1575 and higher in the coming weeks,keeping a strict stop loss at 770.</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-74723625953338553552013-10-27T23:05:00.000-07:002013-10-27T23:05:06.406-07:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgkQEljrhGhg9K2X4f1801A6EOt80M5l7cyCJoTLu7mRb0hoQv9NKlxyj0rwMdPuPHG0pDGtTLC87ZUJb1h8oXsiDW0lEKbYrQnP7jNZ-eoHK9_CCugAKoeXrHdz6O6qUi76JAV5rn6Kkg/s1600/NN.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgkQEljrhGhg9K2X4f1801A6EOt80M5l7cyCJoTLu7mRb0hoQv9NKlxyj0rwMdPuPHG0pDGtTLC87ZUJb1h8oXsiDW0lEKbYrQnP7jNZ-eoHK9_CCugAKoeXrHdz6O6qUi76JAV5rn6Kkg/s1600/NN.PNG" height="145" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty Daily Chart<br /> ( source : <a href="http://www.icicidirect.com/">www.icicidirect.com</a> )</td></tr>
</tbody></table>
<div style="text-align: justify;">
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.</div>
<a name='more'></a>For the very short-term,nifty has broken the uptrend.Daily momentum oscillators were already in the overbought region and have turned negative.Below 6175,Profit booking is expected to continue in the market ,dragging the index lower.<br />
<div style="text-align: justify;">
On lower side,levels of 6040 and 5970 may provide support for the week.Short position can be taken in the index below 6175 targeting 6000 levels.Stoploss can be placed at 6230.</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-61526236399940249602013-10-24T10:54:00.001-07:002013-11-23T21:53:19.989-08:00Technical Analysis<div dir="ltr" style="text-align: left;" trbidi="on">
<div dir="ltr">
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 '<br />
<a name='more'></a><br />
By definition,Technical Analysis is the technique of predicting future prices for a security based on past price actions for that security.All the past price actions are presented in the form of a chart.There are four types of charts commonly used in technical analysis:-<br />
1.Line Charts<br />
2.Mountain Charts<br />
3.OHLC Charts<br />
4.<a href="http://trading-technicals.blogspot.in/2013/11/understanding-candlesticks-in.html">Candlestick</a> Charts<br />
Out of these four charts,Candlestick charts are the most important.The advantage of using a candlestick chart is that it provides more detail of the price action of the security for the day,week,month or year depending on the time frame you are using for the chart.For instance,if we take the daily price action of a stock on candlestick chart,it shall show the opening price of the stock for the day,the high price touched by the stock,the lows made and the closing price at the end of the day for that stock.The use of a candlestick chart originated in Japan,so popularly called <a href="http://trading-technicals.blogspot.in/2013/11/understanding-candlesticks-in.html">Japanese Candlesticks</a>.</div>
<div dir="ltr">
These candles of each day or week or whatever the time frame lead to formation of patterns on the charts.These patterns are for short-term,medium-term or long-term time frame.These are of various types.For example:-</div>
<div dir="ltr">
1. Head and Shoulders Pattern ( Bearish )</div>
<div dir="ltr">
2.Inverse Head and Shoulders Pattern ( Bullish )</div>
<div dir="ltr">
3.Cup and Handle Pattern</div>
<div dir="ltr">
4.Symmetrical Continuation Triangle Pattern ( Bullish )</div>
<div dir="ltr">
5.Symmetrical Continuation Triangle Pattern ( Bearish )</div>
<div dir="ltr">
6.Wedge Patterns ( Bearish and Bullish )</div>
<div dir="ltr">
7.Ascending Continuation Triangle Pattern</div>
<div dir="ltr">
8.Descending Continuation Triangle Pattern</div>
<div dir="ltr">
9.Flags</div>
<div dir="ltr">
10.Penants</div>
<div dir="ltr">
To compliment these patterns,there are Indicators and Oscillators which are used by the technical analysts to predict the price movement more precisely.These are also of several types like moving averages,momentum,Relative strength index,stochastics etc.We shall read about them in more datail in the coming articles.</div>
<div dir="ltr">
Technical analysis is of utmost importance for a trader to take trading decisions.It is not that the price projections given by the technical analysis is 100 % accurate.The security may violate the pattern and move in an opposite direction than anticipated,it just gives the possibility of future price movement for the security which may or may not happen.There are several types of software available which a technical analyst may use for the analysis.</div>
<div dir="ltr">
<br /></div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-35067830020121802452013-10-20T10:03:00.000-07:002013-10-21T04:13:01.355-07:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: right;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi76Uvhzq1b2OXbZ_9qgJYHPkrcNOzB7wqhCqTA0JDK1HZm98VaggPaP2ZoGLsSCHgmHpDqZdVapvO4G8E5p-X_sGFmIm0lwj-IX7VjAI5LxDu7FAwbYnU2bhCK__ufWKYKFUaQoSU8j4Y/s1600/NNNN1.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi76Uvhzq1b2OXbZ_9qgJYHPkrcNOzB7wqhCqTA0JDK1HZm98VaggPaP2ZoGLsSCHgmHpDqZdVapvO4G8E5p-X_sGFmIm0lwj-IX7VjAI5LxDu7FAwbYnU2bhCK__ufWKYKFUaQoSU8j4Y/s1600/NNNN1.PNG" height="225" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Nifty Daily Chart ( source:<a href="http://www.icicidirect.com/">www.icicidirect.com</a> )</td></tr>
</tbody></table>
<div dir="ltr">
</div>
<div style="text-align: justify;">
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.</div>
<div style="text-align: justify;">
Nifty has given a breakout above the neckline of the <a href="http://trading-technicals.blogspot.in/2013/10/inverse-head-shoulder-pattern.html">Inverse Head and Shoulders Pattern</a> with good volumes.<br />
<a name='more'></a>Now the index has entered the new territory and has open the gates for targets of 7000 in coming months.So, investors can initiate long positions in the market on declines towards 5700.Area between 5700-6175 is expected to provide good support.</div>
<div style="text-align: justify;">
From short-term term trading point of view,looking at the strong momentum and positive FII's data,Nifty is expected to head towards 6230 and 6345 above that. 6120 and 6040 may provide support on lower side.</div>
</div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-15260244298056475182013-10-15T09:02:00.001-07:002013-10-20T10:04:08.639-07:00Inverse Head & Shoulder Pattern - How to Recognise and Trade It<div dir="ltr" style="text-align: left;" trbidi="on">
<div style="text-align: justify;">
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. </div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhGq7yWZyiVyx6MuPEtdU7qamGh_-vYMhbxMoL5wkEoHGWcXg3qC1KsflWY9ASPWTYT1RBnLMhMFU8VlB2Hj4Z7SKSK_lI2FPMCbFN_yXfrnkME7FKPlfj1gJ8Wp8-iuIfCGqAlSVaj2tI/s1600/H&S.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhGq7yWZyiVyx6MuPEtdU7qamGh_-vYMhbxMoL5wkEoHGWcXg3qC1KsflWY9ASPWTYT1RBnLMhMFU8VlB2Hj4Z7SKSK_lI2FPMCbFN_yXfrnkME7FKPlfj1gJ8Wp8-iuIfCGqAlSVaj2tI/s1600/H&S.PNG" height="206" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Head and Shoulder Pattern</td></tr>
</tbody></table>
<div style="text-align: justify;">
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.</div>
<div style="text-align: justify;">
On breakout of the pattern,traders need to be positioned on the long side to catch the big upmove that the security may give.</div>
<a name='more'></a><div style="text-align: justify;">
<br /></div>
<div dir="ltr" style="text-align: justify;" trbidi="on">
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
<strong>Formation of the Pattern -</strong></div>
</div>
<div dir="ltr" style="text-align: justify;" trbidi="on">
<div style="text-align: justify;">
<strong></strong><br /></div>
<div style="text-align: justify;">
Inverse H&S pattern is formed of two Shoulders which may or may not be of equal size and a Head which is bigger in size than the shoulders . A straight line joining the peaks of the shoulder and head curves makes the neckline for this pattern.This neckline can be horizontal or slanting upwards or downwards.A pattern with upward slanting neckline is considered more strong.In routine you may not see the pattern as symmetrical as shown in figures because securities move randomly and not symmetrically.So you need to be very vigilant to spot the pattern on the chart.After the formation of second Shoulder,when the security breaks above the neckline with higher than normal volumes,it confirms the pattern.The time taken by the pattern to complete can be days,weeks or months.The longer it takes to complete,the longer it would take take to accomplish the target.</div>
</div>
<div dir="ltr" style="text-align: justify;" trbidi="on">
<div style="text-align: justify;">
<br /></div>
<div style="text-align: justify;">
<strong>How to trade Inverse H & S Pattern ?</strong></div>
</div>
<div dir="ltr" style="text-align: justify;" trbidi="on">
<div style="text-align: justify;">
<strong></strong><br /></div>
<div style="text-align: justify;">
Break out above the Neckline is the signal for taking long positions in that security.Point to be taken care of is that volumes of the trade should be higher than average when it breaks out.Stoploss for the trade is the lowest level touched by the stock when it was in the making of Head of the pattern.Projected target for this trade is the difference in the price of the security at the peak of shoulder 1 and the trough of the head.</div>
<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="http://lh6.ggpht.com/-y_7l0f0AaiA/Ul1W6sUCbNI/AAAAAAAACQ4/qpqSh5zGYUs/s1600-h/Capture%252520h%252520s%25255B51%25255D.png" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img alt="Capture h s" border="0" src="http://lh3.ggpht.com/-2TewLM5r9Qw/Ul1W7kbfRpI/AAAAAAAACRA/reoauUzHFPA/Capture%252520h%252520s_thumb%25255B51%25255D.png?imgmax=800" height="267" style="border: 0px; display: inline;" title="Capture h s" width="640" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Heromotocorp-Head and Shoulder Pattern Breakout</td></tr>
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Let’s take an example.The chart in the Figure taken from <a href="http://www.moneycontrol.com/stock-charts/heromotocorp/charts/HHM#HHM">moneycontrol.com</a> is for Heromotocorp stock which has formed an Inverse H & S pattern and accomplished the target after breakout. The orange line joining points 3 and 5 makes the neckline and the stock breaks out at point 7 ( arrow ) which coincides with stock price of Rs.1715.The target for this breakout is difference between point 3 and point 5.so it comes out to be 1767-1435=Rs.332 above the breakout levels.So,our target comes out to be 1715+332=Rs.2047 which was achieved by the stock and even went higher than that.You earned 20 % in four months.Stoploss we need to place at level of 1430 (see blue line at the head -point 4).</div>
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To keep our stoploss short,we can place it at point 6 ( Rs 1615 ) also but the risk of it being triggered or violated is high.Sometimes,after breakout stock may see lower levels just to test the trough of second shoulder as in this case it went even lower than that. The thing here a trader can do is to anticipate the breakout and buy the stock at the trough itself when it has formed and the stock starts to rise.The risk here is that the pattern may or may not confirm and there is no breakout.Another thing you can do if stoploss is placed at point 6 is that you give some space to the stock to fluctuate as per your risk profile.This is called Trade Managing.</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-69032353075399032772013-10-13T03:30:00.000-07:002013-10-21T03:10:55.452-07:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
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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.</div>
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<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="http://lh6.ggpht.com/-n3jju1mPBOs/Ulq887_Im2I/AAAAAAAACOI/IUt3JWn9rpo/s1600-h/CaptureNF%25255B5%25255D.png" style="margin-left: auto; margin-right: auto;"><img alt="CaptureNF" border="0" src="http://lh6.ggpht.com/-blBotjgke1g/Ulq899KALlI/AAAAAAAACOQ/u7YNyzgrBX0/CaptureNF_thumb%25255B1%25255D.png?imgmax=800" height="176" style="border: 0px; display: inline;" title="CaptureNF" width="244" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Fig 1-Nifty chart</td></tr>
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<tr><td style="text-align: center;"><a href="http://lh5.ggpht.com/-AETLz-y8YyM/Ulq8_HxW90I/AAAAAAAACOY/XapxJgnVz-Y/s1600-h/CaptureNF2%25255B2%25255D.png" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img alt="CaptureNF2" border="0" src="http://lh5.ggpht.com/-ZewjhsNslng/Ulq8_7xP_yI/AAAAAAAACOg/I9OkHLvr2Wk/CaptureNF2_thumb.png?imgmax=800" height="244" style="border: 0px; display: inline;" title="CaptureNF2" width="162" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"> Fig 2-TRIX & Momentum</td></tr>
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On daily chart,Nifty is in the process of making an <a href="http://trading-technicals.blogspot.in/2013/10/inverse-head-shoulder-pattern.html">Inverse Head and Shoulder Pattern</a>,a trend reversal bullish pattern,the neckline ( orange <a href="http://trading-technicals.blogspot.in/2013/10/what-is-trendline-and-its-significance.html">trendline</a> ) 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. </div>
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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 )</div>
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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 ) </div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-20635680684813626862013-10-09T09:11:00.000-07:002013-10-21T03:56:02.602-07:00Heromotocorp breaking out of a bullish triangle pattern<div dir="ltr" style="text-align: left;" trbidi="on">
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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.</div>
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEimeF5GgSAljtfM_42NIIbuFnsTJz4P8xmHD_0w7PQ2OPcPqq7ZJUKGKhNzqUPG_VN8UXS7OjTEen_R5ws64nLmRBH5R_BBk68xn5XwtASoXxRWW72GGu6PtrjJZgOjGVsBFUoWo5ALmpg/s1600/HERO.png" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em; text-align: justify;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEimeF5GgSAljtfM_42NIIbuFnsTJz4P8xmHD_0w7PQ2OPcPqq7ZJUKGKhNzqUPG_VN8UXS7OjTEen_R5ws64nLmRBH5R_BBk68xn5XwtASoXxRWW72GGu6PtrjJZgOjGVsBFUoWo5ALmpg/s1600/HERO.png" height="185" width="400" /></a><br />
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On lower side, the stock is consistently taking support on the <a href="http://trading-technicals.blogspot.in/2013/10/what-is-trendline-and-its-significance.html">trendline</a> 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 )</div>
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Technical oscillators like RSI ,slow stochastic s are already in buy mode and momentum oscillator is also in positive territory.</div>
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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 ).</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-82540106946423992362013-10-06T07:58:00.000-07:002013-10-20T10:08:21.158-07:00How to be a millionaire by investing in stock market<div dir="ltr" style="text-align: left;" trbidi="on">
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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.</div>
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<b>What to buy,when to buy and how much to buy ?</b></div>
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Answers to these simple questions require very meticulous planning and a careful evaluation of the stock company you want to invest in because when the markets are in cheerful mood it appears an easy task but when the markets start falling,they have the tendency to throw shivers through the body of an even an experienced and educated investor.We would try to understand all this phenomenon in this article.</div>
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To start your journey towards wealth creation, first of all you have to decide the time horizon you for which you can remain invested.Usually it should be minimum of 5 years.Longer the time period you give,the better the results are.So,you should always approach the stock market with long term view.It is the long term investment that creates wealth.Remember,trading is only for short term small gains.</div>
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<b>How to pick a stock for investment</b> :-</div>
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When an investor thinks for an investment , he has two motives ; wealth creation by capital gain and regular income as dividends over the period of investment. Keeping this strategy in mind , a stock is selected . Hence , we always need to pick the stock of a company of that sector where the the growth is visible in future.The company should have high growth revenue and high Price to Earning Ratio ( P/E multiple ). P/E values you kind find on the balance sheet of the companies which they present quarterly while declaring quarterly results for that company. To have regular income , high dividend yield stocks are preferred . These companies are known to give dividends regularly to its investors..Dividend is the certain percentage of cash given to the investors by the company out of its profits earned.However, a company is not bound to declare dividend.Dividend can be given during the year ( interim dividend) or at the end of the year ( final dividend) your investment becomes a regular source of income also along with the growth of capital Other important things to consider while selecting a stock for investment is that management of company is competent , has clean image and is not involved in unnecessary controversies.</div>
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<b>How to invest :-</b></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiwJsIkBwTsIyi7HLhHpQ7-1dJcM2CsfrYvg51iiI_o9RNAueBGejZxEGCzBCwm5DKrhyphenhyphen9RSErKqNwA3n4L0N2_tAoNjHfw4va1JM47fWTP2W-2jctB24EUwnCFKrdx5AFbyHBZv7CoffY/s1600/IVQ.png" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em; text-align: justify;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiwJsIkBwTsIyi7HLhHpQ7-1dJcM2CsfrYvg51iiI_o9RNAueBGejZxEGCzBCwm5DKrhyphenhyphen9RSErKqNwA3n4L0N2_tAoNjHfw4va1JM47fWTP2W-2jctB24EUwnCFKrdx5AFbyHBZv7CoffY/s1600/IVQ.png" height="185" width="400" /></a></div>
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Better strategy to Invest in markets is in a staggered manner.Allocate an amount you are comfortable in investing on weekly,fortnightly or monthly basis and continue with that in a disciplined manner just like the SIP ( Systematic Investment Plan ) in provided by Mutual Fund Companies. These are provided as Equity SIP by some brokers .Discipline in investment means that.you have to continue with your investment as per your schedule without bothering if market is going up or down.Risk of buying in lump-sum is that you never know whether you are buying at the top of the market or at the bottom.This risk is neutralized by investing in staggered manner.</div>
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<b>Advantage of long term view on investment :-</b></div>
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<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right; margin-left: 1em; text-align: justify;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEieqCtZwOWPjDVm1LurutG0QFUW8Uiff_OnU9i4jlsYQaFzsYoTaB4AQrxwwrM5b0xjODQ3c1dVSRQE9e_Cbm60Er2-q3qbz79d3v5j-74tZaHdGQvBDbiupDU8V-DnJMB_bAKx71VwWMM/s1600/Capture.PNG" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEieqCtZwOWPjDVm1LurutG0QFUW8Uiff_OnU9i4jlsYQaFzsYoTaB4AQrxwwrM5b0xjODQ3c1dVSRQE9e_Cbm60Er2-q3qbz79d3v5j-74tZaHdGQvBDbiupDU8V-DnJMB_bAKx71VwWMM/s1600/Capture.PNG" height="320" width="284" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Table.1</td></tr>
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As we talked above, we should keep long term view for equity investment.The major advantage of longer period is the 'power of compounding' which the investment generates.More significantly,the long term equity investment become eligible for Dividends and the Bonuses the companies declare which adds towards our achievement of goal of wealth creation.Moreover,companies also declare bonus when they earn good profits.Bonus is allotment of stocks in addition to your number of stocks purchased.It can be in the ratio of 1:1,1:2,2:3 or as the company decides.</div>
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<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiWMXTxgFqocBT4BMa6IBPc-veaEtX1Md-skAKdKzM1vC2o18fgeQRvkTUsOgRPXhFyrBnMIMTMxocgPHOGakSvjaQULtphS9Ol4jeHN9dwCOjP0YRGFIq0FSO2KqDMDYmpDcZhK4wuThE/s1600/Capturenow.PNG" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiWMXTxgFqocBT4BMa6IBPc-veaEtX1Md-skAKdKzM1vC2o18fgeQRvkTUsOgRPXhFyrBnMIMTMxocgPHOGakSvjaQULtphS9Ol4jeHN9dwCOjP0YRGFIq0FSO2KqDMDYmpDcZhK4wuThE/s1600/Capturenow.PNG" height="195" width="320" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;">Table. 2</td></tr>
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Let's take an example of Indian IT bellwether company,Infosys Technology.</div>
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Suppose,you would have bought 100 shares of the company for Rs 9500 in 1993 and kept it with you till 2010.Can you how imagine,how this investment would have panned out in this period and have created wealth for you? In Table 1, you can see the dividends and bonuses declared by the company throughout this period.Considering only the dividend payouts,it amounts to nearly 32,00,000 ( see Table 2 ).Now, in 2010, the infosys stock was trading at around 2500 and number of shares increased to 85,500 from meager 100 after adding all the bonuses and the stock split. Here,capital gain amounts to whopping 12800*2500= Rs.32000000-9500= Rs.3,19,90,500.This is a stunning picture but true.</div>
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So, investing in good quality stocks with good future prospective and keeping that investment for longer periods is always rewarding and helps you achieve your goal of being a millionaire when compared to any other asset class of investing.</div>
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Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0tag:blogger.com,1999:blog-1358923570617434806.post-72202225148903923332013-10-05T23:58:00.001-07:002013-10-21T03:11:19.399-07:00Outlook for NIFTY for the coming trading sessions<div dir="ltr" style="text-align: left;" trbidi="on">
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.<br />
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhe7R1KtSy6xrY6MasOSk1j-2FhpSV7NrcZiNz05IOVTaVKJsb97gqpcM64rizm-6TBbPbdG155VmQKIMAuvWuJnd1kIRha7rBFijnr4SVvZeRhV_17OG6papUpGR-kc_qqi8E2ZBZB4Y8/s1600/NIFTY+I.png" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhe7R1KtSy6xrY6MasOSk1j-2FhpSV7NrcZiNz05IOVTaVKJsb97gqpcM64rizm-6TBbPbdG155VmQKIMAuvWuJnd1kIRha7rBFijnr4SVvZeRhV_17OG6papUpGR-kc_qqi8E2ZBZB4Y8/s1600/NIFTY+I.png" height="146" width="320" /></a>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.<br />
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.<br />
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. </div>
Anonymoushttp://www.blogger.com/profile/08238702852001652199noreply@blogger.com0