Update 10:40 AM: Nifty CMP 10810- Nifty cover one part (50%)short now. Hold balance short ( 1 part)
Open short Positions
Trade 1 @ 10840 ( 1 part)
Friday, January 11, 2019
Nifty Trade Update -11th Jan 2019
Update 10:40 AM: Nifty CMP 10810- Nifty cover one part (50%)short now. Hold balance short ( 1 part)
Open short Positions
Trade 1 @ 10840 ( 1 part)
Thursday, January 10, 2019
Bank Nifty, RSI and Nifty
Strong Negative Divergence- Bank Nifty with RSI & Nifty
This is one important development taking place since last few days.Bank Nifty is consistently showing negative divergence with RSI and Nifty. Divergence happens when Price move upwards but the oscillators ( like RSI) moves downwards. This shows even though the price is moving up the strength is missing and such up moves are not to be trusted with.
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| Bank Nifty Divergence with RSI & Nifty |
For a genuine bull run I would ideally like to see no divergences.
Nifty View: Update for 11th Jan 2019
Near Term Trend: ↓ (Down)
Market update: Nifty opened at par ( even though SGX was indicating a positive open) and kept drifting in a narrow range today and finally closed at 10825 levels (down 30 points). It was a pretty listless trading session ( yes you may call it boring) and Nifty made an "inside bar" meaning high and low of yesterday were not breached.
Even though todays session was boring, it assumes lot of significance. I had mentioned in my yesterdays post that " the sharp pull back in last hour has potential to change the trend for Nifty for short term" Bull needed to trade strong above 10870 levels today to bring some strength in markets however they failed once again. Even though Market didn't fall, the inability of bulls to take market higher above the opening prices ( since last 4 days) is weighing heavily on the markets and it assumes a lot of significance in the near term.
There were also a probability if the sharp pull back witnessed yesterday was indeed a 'bear trap' but now the chances of same are almost zero.
Bank Nifty is consistently giving divergence with Nifty, looking at bank nifty chart ( even though I don't track it) I can see its looking much weaker and today while Nifty fell 0.3% Bank Nifty fell 0.7% generally its not very often that one see divergence between bank Nifty and Nifty and sometimes when its there ( not saying always)it might be a sign for something bigger which is cooking in markets.
Another point worth noticing is the negative breadth of the market. Since last few days the declining stocks are outnumbering the advancing stocks ( even though Nifty was rising) which again raises the concern if the distribution is going on in the markets (and to me its nothing but distribution only).
Still no change in my Bearish view, doesn't matter how much pull back Nifty gives and for how long it consolidates till the time I see the actual strength in the prices I wont change my stance. It took Nifty 3 days to reach 10870 levels ( from lows of 10630) now to start a new leg downward, Nifty must break 10630 in next 2 days ( sound difficult? lets see).
Again I reiterate, even though the volatility was totally missing today ( sharp contrast to yesterday) it can increase anytime now so please be very careful while trading and keep the qty in check always. if you feel you have made a wrong trade then don't hesitate to cut your loss and exit. If market catches you on the wrong foot, it will wipe your 100% capital in no time.
Trading recommendation: No change in views still. We are carrying our shorts initiated at 10840 levels ( exited our previous shorts around 10700 levels). Many traders are adding long/shorts and getting chopped and suffering losses on both sides (which happens during sideways trading). For now one must avoid compulsive trading and trade only if you are reasonably sure. Don't recommend going long at this stage so if you are holding longs then either exit or keep a tight stop loss.
Good Day and Happy Trading to you!
Market update: Nifty opened at par ( even though SGX was indicating a positive open) and kept drifting in a narrow range today and finally closed at 10825 levels (down 30 points). It was a pretty listless trading session ( yes you may call it boring) and Nifty made an "inside bar" meaning high and low of yesterday were not breached.
Even though todays session was boring, it assumes lot of significance. I had mentioned in my yesterdays post that " the sharp pull back in last hour has potential to change the trend for Nifty for short term" Bull needed to trade strong above 10870 levels today to bring some strength in markets however they failed once again. Even though Market didn't fall, the inability of bulls to take market higher above the opening prices ( since last 4 days) is weighing heavily on the markets and it assumes a lot of significance in the near term.
There were also a probability if the sharp pull back witnessed yesterday was indeed a 'bear trap' but now the chances of same are almost zero.
Bank Nifty is consistently giving divergence with Nifty, looking at bank nifty chart ( even though I don't track it) I can see its looking much weaker and today while Nifty fell 0.3% Bank Nifty fell 0.7% generally its not very often that one see divergence between bank Nifty and Nifty and sometimes when its there ( not saying always)it might be a sign for something bigger which is cooking in markets.
Another point worth noticing is the negative breadth of the market. Since last few days the declining stocks are outnumbering the advancing stocks ( even though Nifty was rising) which again raises the concern if the distribution is going on in the markets (and to me its nothing but distribution only).
Still no change in my Bearish view, doesn't matter how much pull back Nifty gives and for how long it consolidates till the time I see the actual strength in the prices I wont change my stance. It took Nifty 3 days to reach 10870 levels ( from lows of 10630) now to start a new leg downward, Nifty must break 10630 in next 2 days ( sound difficult? lets see).
Again I reiterate, even though the volatility was totally missing today ( sharp contrast to yesterday) it can increase anytime now so please be very careful while trading and keep the qty in check always. if you feel you have made a wrong trade then don't hesitate to cut your loss and exit. If market catches you on the wrong foot, it will wipe your 100% capital in no time.
Trading recommendation: No change in views still. We are carrying our shorts initiated at 10840 levels ( exited our previous shorts around 10700 levels). Many traders are adding long/shorts and getting chopped and suffering losses on both sides (which happens during sideways trading). For now one must avoid compulsive trading and trade only if you are reasonably sure. Don't recommend going long at this stage so if you are holding longs then either exit or keep a tight stop loss.
Good Day and Happy Trading to you!
Wednesday, January 9, 2019
Nifty View: Update for 10th Jan 2019
Near Term Trend: ↓ (Down)
Market update: Nifty opened on a strong note at 10870 levels and kept trading in a tight range for most of the day. There was violent fall in second session and index dropped to 10750 levels and immediately staged a smart recovery of 100+ points to close above 10850.
Markets were extremely volatile throughout the day. I have been mentioning in my posts everyday that volatility is likely to be picked up and if one is not careful or try to be too adventurous, hes likely to be trapped by market in these choppy moves. Today many traders got trapped on both sides and suffered heavy losses. Todays move was just one small example and one needs to be extremely careful about trading in such markets.
Overall, today was another day where Nifty dropped first and then recovered from day lows but at the same time not able to post any gain above the opening price. I mentioned in my yesterdays post that "Bulls are supporting market on every drop but are not willing to invest further above opening price" same thing we got to see today as well. So much of choppiness is suggesting that markets are preparing for its next move ( up or down) and its likely to be violent and should come soon now ( surely choppiness can remain for few more days but that doesn't change anything)
Prices are still contracting, if you ignore the intraday volatility then Nifty has been able to add just 50 points today which is still very much within threshold of 'contraction'. If you notice daily charts, it took Nifty 3 days to fall from 10916 levels to 10630 and now it has taken 3 days to retrace around 80% of the fall. Ideally bulls would have liked to see full 100% retracement by now ( we still need to see how tomorrows trading goes because on Sensex chart this down move took about 4 days).
We maintain our bearish stance for now, however todays sharp pull back is capable of changing Niftys trend for short term as todays last hour move felt like a perfect 'Bear Trap' (depends on how Bull take it from here).
Trading recommendation: No trade is recommended at these levels. if someone is long he can square off his position and wait for markets to give confirmation and enter again. We are still holding 2 parts short ( 10840) and even though temptation was high to add shorts below 10800 levels we resisted as the nifty movement was not convincing. Many intraday traders did enter short below 10800 levels today were seen running for cover in last 30 minutes).
Happy trading to you!
Market update: Nifty opened on a strong note at 10870 levels and kept trading in a tight range for most of the day. There was violent fall in second session and index dropped to 10750 levels and immediately staged a smart recovery of 100+ points to close above 10850.
Markets were extremely volatile throughout the day. I have been mentioning in my posts everyday that volatility is likely to be picked up and if one is not careful or try to be too adventurous, hes likely to be trapped by market in these choppy moves. Today many traders got trapped on both sides and suffered heavy losses. Todays move was just one small example and one needs to be extremely careful about trading in such markets.
Overall, today was another day where Nifty dropped first and then recovered from day lows but at the same time not able to post any gain above the opening price. I mentioned in my yesterdays post that "Bulls are supporting market on every drop but are not willing to invest further above opening price" same thing we got to see today as well. So much of choppiness is suggesting that markets are preparing for its next move ( up or down) and its likely to be violent and should come soon now ( surely choppiness can remain for few more days but that doesn't change anything)
Prices are still contracting, if you ignore the intraday volatility then Nifty has been able to add just 50 points today which is still very much within threshold of 'contraction'. If you notice daily charts, it took Nifty 3 days to fall from 10916 levels to 10630 and now it has taken 3 days to retrace around 80% of the fall. Ideally bulls would have liked to see full 100% retracement by now ( we still need to see how tomorrows trading goes because on Sensex chart this down move took about 4 days).
We maintain our bearish stance for now, however todays sharp pull back is capable of changing Niftys trend for short term as todays last hour move felt like a perfect 'Bear Trap' (depends on how Bull take it from here).
Trading recommendation: No trade is recommended at these levels. if someone is long he can square off his position and wait for markets to give confirmation and enter again. We are still holding 2 parts short ( 10840) and even though temptation was high to add shorts below 10800 levels we resisted as the nifty movement was not convincing. Many intraday traders did enter short below 10800 levels today were seen running for cover in last 30 minutes).
Happy trading to you!
Tuesday, January 8, 2019
Nifty View: Update for 9th Jan 2019
Near Term Trend: ↓ (Down)
Market update: Nifty opened slightly positive around 10795 levels made a high of 10819, low of 10733 and closed at 10800 levels up 30 points. On daily charts Nifty made a 'Doji' candle with a long down shadow. such a 'Doji' indicate indecisiveness with support at lower levels. 'Doji' occurs when both open and close point of day are roughly in same region.This shows though bulls are ready to support market at lower levels they are not ready to invest further beyond the opening prices.
Overall there is no change in Nifty view, and as per my view Nifty still remains in a bear trend. We need a strength from 10800+ levels & then 10900+ to signify bulls are getting stronger, till the time that happens we prefer sticking to bearish stance.
Compression of prices still continues in Nifty it may finish in a day or two or it may continue for few more days but not much time remaining now and nifty should give a breakout in either direction pretty soon (our preferred direction remains on the downside).
If you look at Nifty weekly charts you will notice that since last 7-8 weeks, Nifty is consistently hovering in a tight range of 10600-10900. For positional traders its a very difficult phase because markets are absolutely doing nothing and there is no clear trend emerging that's why its important to be patient and keep a calm head always. Whenever market gives a break out we should be ready for it. Such 'Nothing' phases are expected in markets ( especially when markets have already given a fall of 1700+ points in 6-7 weeks ( from High of 11750 to 10K levels). Just FYI (though its not mentioned on the blog) we were short around 11600 levels and covered our positions around 10500 previously so we can afford to be patient.
Technically speaking, still believe its a diametric pattern (Markets have not given me any reason to doubt it so far) and we should patiently wait for either for completion of this pattern or for markets to prove that its wrong.
Trading Recommendations: We covered our 1 part short today around 10767 levels in the morning, there were signs of consolidation continuing so we thought reducing some positions at this stage will be wiser ( Intraday Nifty went 50+ points from that point). For now we are only holding shorts initiated @10840 levels but wont hesitate to short again the moment we feel market is ready for a down move.
Market update: Nifty opened slightly positive around 10795 levels made a high of 10819, low of 10733 and closed at 10800 levels up 30 points. On daily charts Nifty made a 'Doji' candle with a long down shadow. such a 'Doji' indicate indecisiveness with support at lower levels. 'Doji' occurs when both open and close point of day are roughly in same region.This shows though bulls are ready to support market at lower levels they are not ready to invest further beyond the opening prices.
Overall there is no change in Nifty view, and as per my view Nifty still remains in a bear trend. We need a strength from 10800+ levels & then 10900+ to signify bulls are getting stronger, till the time that happens we prefer sticking to bearish stance.
Compression of prices still continues in Nifty it may finish in a day or two or it may continue for few more days but not much time remaining now and nifty should give a breakout in either direction pretty soon (our preferred direction remains on the downside).
If you look at Nifty weekly charts you will notice that since last 7-8 weeks, Nifty is consistently hovering in a tight range of 10600-10900. For positional traders its a very difficult phase because markets are absolutely doing nothing and there is no clear trend emerging that's why its important to be patient and keep a calm head always. Whenever market gives a break out we should be ready for it. Such 'Nothing' phases are expected in markets ( especially when markets have already given a fall of 1700+ points in 6-7 weeks ( from High of 11750 to 10K levels). Just FYI (though its not mentioned on the blog) we were short around 11600 levels and covered our positions around 10500 previously so we can afford to be patient.
Technically speaking, still believe its a diametric pattern (Markets have not given me any reason to doubt it so far) and we should patiently wait for either for completion of this pattern or for markets to prove that its wrong.
Trading Recommendations: We covered our 1 part short today around 10767 levels in the morning, there were signs of consolidation continuing so we thought reducing some positions at this stage will be wiser ( Intraday Nifty went 50+ points from that point). For now we are only holding shorts initiated @10840 levels but wont hesitate to short again the moment we feel market is ready for a down move.
Nifty Trade Update -8th Jan 2019
Nifty Trade Update -4th Jan 2019
Update 09:54 AM: Nifty CMP 10767- Exit 1 part shorts initiated . at right time we will initiate more shorts or cover existings ones.
Open short Positions
Trade 1 @ 10840 ( 2 parts)
Open short Positions
Trade 1 @ 10840 ( 2 parts)
Monday, January 7, 2019
Nifty View: Update for 8th Jan 2019
Near Term Trend: ↓ (Down)
Market update: Nifty opened on a very strong note above 10800 levels but couldn't sustain the momentum and late profit booking dragged index to around 10750 levels & it final closed at 10770 up 40 points. At one point of time Nifty was 100+ up but gave up more than 50% of its gain.
When Dow was 700 down Nifty was 50 point up ( Friday) now that Dow was 700 point up, Nifty could add up only 40 points. So one should not look at Dow and then take a position in Nifty. Having said that, I am of opinion that Nifty has been outperforming Dow for quite some time now however I don't think this will last for much longer. Soon we might have a situation where Nifty start underperforming Dow. anyways, we will cross that bridge when we get there.
We have been saying that overall Nifty remain in a downtrend and intermittent pull backs will keep coming and one should not attach too much importance to them. Even today when Nifty was trading at 100 points up, we had mentioned in our whatsapp updates that Nifty remains in a downtrend and this gap up opening/pullback doesn't change anything.
Extremely critical Juncture: I had mentioned in my previous post that support area for Nifty is rising and is compressing the price action. Now one can see even the resistance area is compressing (first it was 10980 then 10920 and today it was 10830). Support area moving up and resistance area moving down is compressing Nifty action from 2 sides. Once this compression completes (and not much time is remaining for same), Nifty will explode ( up or down). I am of opinion that it will explode in a bearish trend however markets can prove me wrong so the bullish option stays open too (though its not my preferred scenario under current circumstances).
Technically speaking, Nifty is still in its last leg of diametric pattern. This compression is very symptomatic or indicative of final legs of Diametric and that's the reason I feel we might see a downward movement in Nifty. What we are seeing in market is clear sign of distribution and index management ( where only few heavy weight stocks are holding index). Many readers are asking me to put an overall long term wave count of Nifty and I will surely do that once I get time. For now we need to concern ourselves with near term movement of Nifty ( trust me its going to be extremely interesting).
Trading recommendations: Still holding the balance shorts for now and will square off or add more shorts depending on which way we feel market is moving in. Once again I suggest not to trade big, volatility can increase anytime and will chop you hands off if you are not careful.
If you wish to join us on whatsapp for nil charges/free then please follow below link, its just a promotional offer and will be stopped in couple of days time
http://niftywaveindia.blogspot.com/search/label/Announcement-Join%20us
Market update: Nifty opened on a very strong note above 10800 levels but couldn't sustain the momentum and late profit booking dragged index to around 10750 levels & it final closed at 10770 up 40 points. At one point of time Nifty was 100+ up but gave up more than 50% of its gain.
When Dow was 700 down Nifty was 50 point up ( Friday) now that Dow was 700 point up, Nifty could add up only 40 points. So one should not look at Dow and then take a position in Nifty. Having said that, I am of opinion that Nifty has been outperforming Dow for quite some time now however I don't think this will last for much longer. Soon we might have a situation where Nifty start underperforming Dow. anyways, we will cross that bridge when we get there.
We have been saying that overall Nifty remain in a downtrend and intermittent pull backs will keep coming and one should not attach too much importance to them. Even today when Nifty was trading at 100 points up, we had mentioned in our whatsapp updates that Nifty remains in a downtrend and this gap up opening/pullback doesn't change anything.
Extremely critical Juncture: I had mentioned in my previous post that support area for Nifty is rising and is compressing the price action. Now one can see even the resistance area is compressing (first it was 10980 then 10920 and today it was 10830). Support area moving up and resistance area moving down is compressing Nifty action from 2 sides. Once this compression completes (and not much time is remaining for same), Nifty will explode ( up or down). I am of opinion that it will explode in a bearish trend however markets can prove me wrong so the bullish option stays open too (though its not my preferred scenario under current circumstances).
Technically speaking, Nifty is still in its last leg of diametric pattern. This compression is very symptomatic or indicative of final legs of Diametric and that's the reason I feel we might see a downward movement in Nifty. What we are seeing in market is clear sign of distribution and index management ( where only few heavy weight stocks are holding index). Many readers are asking me to put an overall long term wave count of Nifty and I will surely do that once I get time. For now we need to concern ourselves with near term movement of Nifty ( trust me its going to be extremely interesting).
Trading recommendations: Still holding the balance shorts for now and will square off or add more shorts depending on which way we feel market is moving in. Once again I suggest not to trade big, volatility can increase anytime and will chop you hands off if you are not careful.
If you wish to join us on whatsapp for nil charges/free then please follow below link, its just a promotional offer and will be stopped in couple of days time
http://niftywaveindia.blogspot.com/search/label/Announcement-Join%20us
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