Market Cycle Dates

[gemat]

we are expecting good monsoon this year combined with declining inflation and rbi may cut rate again. going long is a good idea, nifty will test 8000-8100 or more until state election results are announced, if bjp loses in assam, if they are unable to open account in kerala, west bengal, tamil nadu it is going to hurt investor sentiment and all these pseudo secular parties gang up on BJP, expect a big downfall.

 

[Contra]

Part (A) -- Nifty Futures Trading Idea (18 Apr 2016)

There was a resistance at 7901.75 as evidenced by the price rejection at that point between 10.45 and 11am.

Price drifted lower and rallied to break that level between 11.45am to 12pm, confirming that to be a valid "buy" level. Two separate candles tested that exact level.

So we go Long at 7902 and exit at 7914 for 12 points profit.


Part (B) -- Nifty Index Level (18 Apr 2016)

Refer to my chart and explanation from yesterday: http://www.traderji.com/equities/101170-market-cycle-dates-2.html#post1151803

Nifty is now within striking distance of the monthly fibonacci level of 7925 (I had posted the importance of this level and its implication to long-term trends yesterday). To summarize, this level corresponds to the 38.2% fibonacci extension of the monthly high-low range that can be traced back to 2008.

Chart reposted below for quick reference.

 

[Contra]

As long as Nifty (index) stays above 7910, it will continue to be in bullish mode.

Above 7910, we see the following bullish levels:
7947
7998
8080

(This is in conjunction with the other related levels posted here: http://www.traderji.com/equities/101170-market-cycle-dates-2.html#post1151106)

Bearish risk is below 7910 with a range that has a support at 7842

 

[Contra]

Part (A) - Nifty Futures Intraday Trade Idea (20 Apr 2016)

Clear shorting opportunity in the morning session today since Nifty (futures) stayed below 7943 after 10 am. (There was a resistance at 7943 and a support at 7921 based on discretionary visual levels on the 15 min TF).

Since the support at 7921 was breached, we short at that level following a brief pullback and cover at 7909 for 12 points profit.


Part (B) - Nifty Index Level (20 Apr 2016)

Refer to my post and chart from 13 Apr (7 days ago):

There's a bullish consolidation zone between 7842 and 7938 that will decide the further movement of Nifty. There's also a minor resistance at 7857 (as per my post from 3 days ago)

Reversals, if any, can happen between these levels.

Nifty will also have to go through 7973 before it can reach the 8000 levels.

Nifty (index) today failed to break through the upper part of the bullish consolidation zone between 7938 and 7973 despite making a high at 7950. However, it managed to stay above 7910 but is still below the (important) monthly fibonacci level at 7925.

This points to three things:
(1) consolidation day after the bullish run-up
(2) signs of bullish exhaustion and possibility of bearish pressure emerging
(3) upside is still possible as long as 7910 holds and 7925 breaks

Four levels matter for bullish continuation: 7910, 7925, 7938 and 7973

A close below 7910 will bring the focus back to 7857 and 7842

 

[Contra]

Part (A) - Nifty Futures Intraday Trading Idea (21 Apr 2016)

Price was moving (falling) too fast in the beginning of the day to be able to take a short trade. So we wait on the sidelines for prices to stabilize and a clear level to emerge. That level was 7943

Following an upward pullback from that level, we short at 7943 and cover at 7931 for 12 points profit.


Part (B) - Nifty Index Level (21 Apr 2016)

As posted yesterday

Four levels matter for bullish continuation: 7910, 7925, 7938 and 7973

Firstly, Nifty tested all of these levels today and, at least till 2pm, it was testing the critical boundaries of the bullish consolidation zone between 7925 and 7973. However, it closed at the lower end of the bullish levels between 7910 and 7925.

Secondly, by clearing 7973 in the morning session, Nifty reversed the losses from Jan & Feb 2016. This again points to my theory about ranging markets with a wide range.

My overall assessment is that the market is unable to go up much but is unable to stay down long either. It is moving in a very wide range that gives the impression that it's either tanking fast or surging aggressively.

There's a word to describe this -- Illusion (which is another way of saying ranging market).

That is, downside total of Jan + Feb was recouped by upside total of Mar + April.

Zero sum game.

Visible on the monthly TF of Nifty

 

[Contra]

Part (A) - Nifty Futures Intraday Trading Idea (22 Apr 2016)

Simple "buy" trade based on confirmation through multiple tests of the resistance level at 7921 between 10am and 11.15am

Once it pulled back from that level, we go long at the second go and exit at 7933 for 12 points profit. Alternatively, you could have also gone long at 7924 and exited at 7936 for the same quantum of profit. In both cases, trade would be over by 12.15pm.



Part (B) - Nifty Index Level (22 Apr 2016)

Frontloading Nifty with a longer range view.

Mean value for Nifty is currently at 7915 which is closer to the bullish cap or continuation level of 8017. This points to an overbought index and bearish pressures because of Nifty's close below both 7915 and 7910.

I see the following weekly levels on Nifty:

Bullish levels -- 8017 and 8123
Bearish levels -- 7717 and 7581

Specially watch for the range between 7842 - 7857 - 7925 - 7937

 

[Contra]

Part (A) - Nifty Futures Intraday Trading Idea (25 Apr 2016)
Note that this is the May 2016 contract (next month), not the Apr 2016 contract

Support at 7899 and pullback from 7884 was noticed. Once price pulled up of 7899, at the next downmove, we go short at 7899 and exit at 7887 for 12 points profit.


Part (B) - Nifty Spot Level (25 Apr 2016)

As posted on Friday

Specially watch for the range between 7842 - 7857 - 7925 - 7937

Nifty closed within this range (at 7855), breaking below it, confirming bearish pressure and the overbought nature of the market. The high was below the important monthly fibonacci of 7925 while the low was below the important support at 7842

This was expected since Nifty had reached the 2016 high last week while this week, it's F&O expiry.


Part (C) - News

Something interesting from Moneylife about algo trading, whistleblowers and preferential treatment to big traders/brokers. More people should be aware of this.

TAC Report Proves Systemic Lapses at the NSE: http://www.moneylife.in/article/tac-report-proves-systemic-lapses-at-the-nse/46692.html

 

[PS Trader]

Nifty will be out of the woods only if it crosses and closes beyond 7842. It's a critical upside resistance that can cap or stall a market rally.

Once it does that, it could face another hurdle at 7938

The range between 7842 and 7938 is important for bullish consolidation.

If Nifty can decisively break both levels then there's very little stopping it from reaching 8000+ levels.

But if those levels fail, then we can see a correction to a mean range between 7535 to 7547

If that mean range fails then we can see a downside selloff till 6593

The bottom for this market has widened from 6760 to 6590

Topside is between 7840 and 7940

Hi, the bullish continuation levels were playing since few days. Successfully market consolidated in the 7842 to 7938 levels , once from low to high and then high to low today completed. and in the last couple of hours market rallied and stands above 7938. So as per your analysis, the next level is 7973 need to be break.

 

[Contra]

Hi, the bullish continuation levels were playing since few days. Successfully market consolidated in the 7842 to 7938 levels , once from low to high and then high to low today completed. and in the last couple of hours market rallied and stands above 7938. So as per your analysis, the next level is 7973 need to be break.

Yes, 7973 is the next level. In fact, Nifty's high today was 7974

So this brings us to the following levels I had posted on 22 Apr (4 days ago)

I see the following weekly levels on Nifty:

Bullish levels -- 8017 and 8123
Bearish levels -- 7717 and 7581

Once 7973 is decisively broken, there's very little stopping it from moving into 8000+... But that will also bring in profit booking into the picture.

 

[Contra]

Nifty Futures (26 Apr 2016)

No trade today since pullback didn't materialize and prices kept going up aggressively.

I was looking to go long at 7899 and exit at 7910 for 11 points gain (prices based on May 2016 contract, not April contract). However, a pullback didn't happen the market simply pushed through higher and higher, so no trade was taken. Even though the trade would have worked, slipped and uncertainty would have ruined it. Hence, days like these, it's better not to trade (at least in my rulebook)

The basic rule of this system is that you need to see a pullback from a resistance level (for Long trade) or a pullup from a support level (for a Short trade).

Only when these pullbacks or pullups happen do they confirm that those S&R are indeed valid and a trade can be taken in that direction.

However, if the price just barrels through that level, or if a pullback / pullup happens too late in the day (after 1pm) then I prefer to avoid trading.

Since I'm a conservative trader, I look for just 1 trade a day. And that trade has to be a high probability setup for a minimum of 10-12 points per trading day. This daily target may seem low to some but I prefer it this way.

Don't chase trades. Let the trade come to you. There's always tomorrow.