#214 Nifty Update: Some rains on the charts

Deficit monsoon has been a matter of worry for investor but some relief has been seen in the last week in some parts of India. On nifty too we saw some rain of relief for the bulls in the last few sessions. On the 14th July i did post our strategy which was going long above 7625  and we have seen a weekly close above that same level giving a confirmation for the power in hands of bulls. Nifty has closed above all the short term moving averages on Daily charts. On the weekly charts we had got a weak closing last week with Nifty closing below 5 Weekly SMA but that proved to be false as Nifty has closed back above that average. Indicators on Daily are signaling buy on the index but weekly indicators are still flat. As you could notice in the adjoining daily chart of Index, Nifty has turned around from the strong support line which had been a resistance line in the move before. It turned around with a "morning star" candlestick pattern. Fundamentally, its quarterly result season and its the first result for this financial year and for the Modi led government. Infosys has given flat results as per expectations but other 2 big giants Reliance and TCS has beaten street estimates. As per reports reliance has seen highest ever FII investment in the stock of almost 20%. This is the good sign of bulls to be in power for longer term. On the economy front, we have seen some highest IIP numbers of 4.7% which is a positive sign for the turnaround. Technically the Nifty is still in a long term bull trend

Our strategy: We recommend to HOLD long initiated at 7625 as per our last post. Tgts on upside are 7850/8031 sl:7456

#172 Nifty Update: Time for some profit booking

RBI governor did surprise markets as traders were expecting a status quo but he did raise repo rate. May be it is the right step has increasing inflation is a concern for our country and even technically it was time for some profit booking on the charts on Nifty. We have got a good thousand points move non-stop and it was the bliss for those atleast got 50% move correct. Next week being expiry it ought to be profit booking as this expiry was only a up move. Next month is going to be earning season and we might continue see disappointing earnings since currency had de-valuated a lot this quarter. Markets are overbought technically on the daily chart and we are expecting some downside in coming weeks. Our strategy is to SHORT Nifty below 5988 with SL of 6090 (Closing basis) tgts 5810/5677/5586  

#2 Global Update: Whats NOW on DOW ??

Yesterday DOW took strong support and close above 14833 which i mentioned as a strong technical level. Indicators are still dicey but trendline support has been taken by the Index. Short term moving averages are near by and we expect DOW to be range bound. Few near by resistances are at 15047,15127 and 15227. DOW has to take strong CLOSING support above 14853. I would recommend to watch for the breakout of the range 14853-15227 before taking any new position in DOW. So WAIT and WATCH!!!!

Disclaimer: I may have personal position in index and above mentioned stocks. Views and News mentioned above may have Errors and omissions. My views are biased more towards technical analysis. Please read and study the market carefully before investing on my idea. For any suggestion contact me on my email. Some words mentioned in article don’t mean their actual meaning. They are correlated for market. 

#162 Nifty Update: 'Once upon a time in NIFTY Again'

All Bollywood lovers are waiting for the movie Once upon a time in Mumbai again while market traders are waiting for some short covering after a free fall from 6093. IIP number nor inflation has been cheering for the markets but only thing cheering the rally are the earning reports better than expected. Take from IT sector to Commodity stocks , all have beat street estimates. Stock valuation has been at lowest levels since last 2 years. Banking and Commodities sectors are the most lucrative for long term buying. Technically nifty is in the downside channel which has been confirmed with two lower lows and lower highs. But we may may see some continued short covering from here upto 5950-6000 levels. We have 2 speed breakers 5773 (200EMA) and 5830 (100 EMA). So we may expect a rally which was once upon a time in Nifty. 

#161 Nifty Update: Sign of Relief for the traders

A "Bullish Harami" pattern in term of candlestick is the turn around or can say reversal sign from a bearish trend. NSEL has been the talk of town since last week. Question still remains can it pay it dues?? Most of the traders or market people believe they will. PMI data of india has been weak but we can gauge our economy only on one data. Inflation has been zig zag while rupee depreciation is hurting the most to investor sentiments. But i feel that this could be the low of near term. Looking at chart, a short covering on nifty is due a high tym. Since my last few posts i have been mentioning to go long on each dip with sl of 5632 and this is the best price or can say least value for the stocks to buy. Technically we may face resistance near to 5760 levels were 100 and 200 EMA are situated but we are confident that if we see a turnaround thn this time a new high of 6400 is inevitable.

#7 Article: Monsoon Trading

Monsoon has been wonderful for the farmers around the country but still not good for the traders, let it be Commodity traders or Equity traders. All the Agri commodities are pouring down in value even more than monsoon while Nifty has been pretty volatile last month but we did achieve first target 5961 which I intimated in last issue. We still have our upside tgts 6132/6300 intact. RBI was the key market turner last month. Raising money market rates from banks was the step taken by RBI to control depreciating rupee. Our currency did improve against USD but what about our economic growth?  Many analyst including me are of the view that squeezing liquidity from economy at a time when we trying to stand up from recession is little harsh step. But controlling our currency and CAD (current Account Deficit) was also important. So everyone will have their own views and I guess RBI would have taken the right step after studying our economic conditions more carefully. Gold import has been reduced almost 50% over last quarter which has reduced our CAD to large extent.

Earning season has been better than estimates other than small banks which have not performed as per estimation. But this should been taken positive change as companies have performed better than previous quarter.  IT and Pharma sector is outperforming at the index and even at the fundamental earnings. Rupee depreciation has helped both the sectors to outperform as they are more over export oriented sectors. Banking and Commodities sectors are the most beaten and stock prices are just unacceptable for the traders and investors but its hard to believe that this is the right time to go long for investor who has the horizon of more than 5-6 years. Tomorrow we have RBI monetary policy review and we expect something in favor of Nifty and Banknifty.

Coming to Nifty technical’s, 100 EMA is at 5869 and 200 EMA at 5750. We are expecting nifty to consolidate between this range.  Indicators are also expecting a range bound to consolidation movement in near future. Graph adjoined to article is weekly chart of nifty and its running in perfect Elliot wave channel. Currently we are in internal correction mode which can be taken as a long term investment. We have been advising seen last 2 issue’s to go long for long term portfolio builders and we continue to do so. Our SL of nifty would be the same i.e., 5757 and 5632  on closing basis. Targets on upside are 6132/6300/6450

#159 Nifty Update: Nifty breaks from a consolidation triangle

After almost 5 days of consolidation mode, Nifty drove itself on the upside yesterday and continued its move today to close above 6000. Last three post i did mention to go long on each dip and our tgt 5975 has been ahcvd. Our nxt tgts our 6062/6136/6300 are activate.. Short term traders should keep SL at 5908/5828 as per the convenience. Infosys have presented a good set of numbers and we expect other companies to do the same. So we are still intact with going long on each dip with sl of 5828 

#158 Nifty Update: Nifty between the lines

Nifty has been trading between the two lines 5750-5905. There is not much fundamentals to cheer for and nor to be upset with. We are experiencing foreign currency volatility at the highest levels. Developed markets  are experiencing a turnaround. China's inflation was announced today which is at the peak this year and and good for the slowing economy. Housing data as i mentioned in last post is improving in US whereas unemployment is stable at 7.6% Looking at commodities, Crude was trading at 42 week highs upto 5th july but since 2 days supply concerns have ease which as seen some profit booking on Crude oil around the world. Gold and Silver is stable and range bound. Dollar has been weakening against major currencies after a good rally last week due to easing economies and easing crude supplies worries. Coming to Technical terms, as headline suggest index is trading range bound between 5750-5900 while hovering all the important moving averages. Indicators are flat. But we are biased more towards upside as most of the nifty stocks are showing bullish signs. We would recommend safe trades to go long above 5900 with strong sl of 5832 then. Supports are seen at 5811/5762. DONT SHORT UNLESS BELOW 5750.

#157 Nifty Update: Tickling Nifty

Nifty was tickling traders today. Today opened with a gap up on back of good unemployment numbers in US. PMI numbers had been improving in western countries. Today SBIN was the most beaten in frontline scripts. Weekly charts are showing some bullish confirmation on the charts. Technically i noticed some interesting things on weekly chart of Nifty. Three instances has been identical on the chart. First, was at the end of week on 08-09-2012 when nifty took support at 100 Weekly EMA and reversed with "Bullish Piercing" pattern of Candlestick. Post confirmation we got nifty movement from 5332-6100. Second instance was proven on 18-04-2013 when nifty again took support at 100 EMA and reversed with another strong pattern "Morning Star" to get move from 5780-6200 post confirmation weak. And last weak was the third instance when NIfty has reversed from 100 weekly EMA and gave third reversal patter 'bullish engulfing"...So now we may assume we should get a short term rally from this point. So every dip is buy as i have been intimating since long. Nifty should close above 5852-5860 and will resist near to 5915-5975  for some days. So still i am biased towards long side with SL of 5730-5762 on closing basis.

#6 Article: Markets at a glance

Nifty has still been trading in the downside channel. In last month issue I did mention that the market was in crucial range between 5855-6118 and could go either. Unfortunately it was on the downside. India was under-performing its western peers. Last month was full for global events which had some profit booking effects on all equity markets. But all the events have some long term good sign of economic recovery. Fed announced that it may stop easing money inflow to the markets as they believe a recovery in US economy is back on track. Consumer confidence number, retail sales number and Home sales number have been increasing significantly in the US while somewhat similar trend has been witnessed in Europe.  But Asia was little hazy last month with their economy and money market. Japan’s Nikkie was on lower circuits for couple of days as yen got stronger while Shanghai compositie also saw more than 5% cut for 2 days as People bank of China plan to squeeze liquidity in markets by making loan approval a stricter way. Overnight money market rates in China had shoot up to 6% when PBOC stated about squeezing liquidity. But overall US and Europe are sighting some recovery in the economy but yet not completely out of recession.

Coming to our market, most talked about last month was USD/INR. Our currency was at the life time low to around 61. No one could have even imagined that we could get to this low in just few months. On my blog http://Chartechnician.blogspot.com I had posted on 30^th October 2012 that we might see Rupee at 62.80 but most of them laughed off but now we are not much far from that level. We might now not see 62.80 ryt now  as RBI has stepped in to protect our economy. Gold import duty was hiked to restrict gold imports and save CAD (Current Account Deficit) but I feel we can save it easily by exporting more goods rather than restricting imports. Technically now as seen in the chart below we May see Rupee strengthening with tgts 59/57.30/55.75-56.20 before making a new low at 62.80. YES!! STILL IN LONGER TIME TGT OF 62.80 ON USD/INR IS INTACT.

Coming to our precious yellow metal, Gold, it still in a downtrend. As I had intimated on my blog on 29^th Jan 2013 that we need to short gold with minimum target of 25000 and we got that target. But looking at the monthly chart of the gold we may see some more downside. In dollar terms we have already seen some downside but in rupee term we may see downside in coming days for the reason I mentioned above that I am expecting our rupee to be strong which could bring down gold price. Last week Morgan Stanley has downgraded the gold targets to $1300 upto 2015. So now gold could not be a preferred investment asset with a medium term view of 3-5 years. Our strategy would be to short gold on every rise with SL of Rs. 28000

Coming to Nifty technical, it is still in a secular bull trend but we are experiencing some reaction within. But monthly chart is moving exactly as per the standard Elliot wave pattern. Now we have a strong support at 5678. 100EMA is 5844 and 200 EMA at 5757 which are crucial levels on nifty nearby.  You all should consider these levels to add longs as we might see some downside upto 5678 but now take that as the opportunity for long term investment. Strategy would be going long on Nifty at CMP and add longs on downside at 5757 and with strict SL of 5632

Note: All the data and graph is as of 28 June 2013 closing

Disclaimer: I may have personal position in index and above mentioned stocks. Views and News mentioned above may have Errors and omissions. My views are biased more towards technical analysis. Please read and study the market carefully before investing on my idea. For any suggestion contact me on my email. Some words mentioned in article don’t mean their actual meaning. They are correlated for market.

#152 Nifty Update: Channeling on Nifty witnessed

Nifty has been witnessed riding in the channel since last 2 months and today we saw low at that support line for 3rd time in same channel. 5750-5794 is the strong support range on the nifty charts as many technical points are clustering around the same level. Still i am not seeing much downside to gain if we short from current levels. So right now risk takers are advised to go long with sl of 5750 and safe traders are advised to take long position over 5883 with short term targets of 5960/6080

#3 Gold Update: Gold traders ..Thumps up to my followers! !

As I have been intimating short on gold since jan ,my 1st tgt 28400 has been achieved today. People around the world are shifting from hard assets to paper assets as their stock markets have been at life time high and economy picture in US has improved.  In India we stilm have governance problem so both the bullion n paper markets is  seeing a set back. But technical suggest a support for nifty at 5400 after infy gave a set back to traders. I did mention in my post that 5400 was strong support for nifty while gold was going to slide down..now technically nxt tgt ia 27100 and than 25000/21000