Market Cycle Dates

Contra

Well-Known Member
#12
If anyone here trades Nifty Futures intraday, this is the trade I would have taken today (8 Apr 2016):

Buy at 7571
Exit at 7584
-------------
Profit = 13 points

That trade would have been over in the morning itself, leaving you free to do other stuff, or wrap up for the day.

For conservative traders, one trade a day is good enough and keeps the risk (and capital) in check.

 

Contra

Well-Known Member
#14
If anyone is wondering how come Nifty made such a huge bullish reversal yesterday afternoon (11 Apr 2016), the reason is simple. Whenever Nifty falls by 100 odd points, you can almost always see a reversal by about the same amount, within the next 1-3 days. It seems like a given in the current market conditions.

This also means 3 things:
  • We are not in a bull market (yet)
  • We are not in a bear market (yet)
  • But we are in a ranging market

Nifty loses ground one day and tries to regain it quickly, and also push through some more to assert its busllishness. It's a sign of consolidation.
 

Contra

Well-Known Member
#16
.....and that 7715 Laxman rekha works again
The bullish surge since yesterday felt as if Nifty would go straight to 8000.

It "could" go but no matter the surge, there were levels it had to go through first (like markers and toll booths on the highway).
7715 is one of those levels, at this point.


As posted 2 days ago:

Three levels matter for bullish continuation: 7715, 7776 and 7857

One level matters for bearish continuation: 7446
Nifty chart today (12 Apr 2016)



See how Nifty tested 7715 today, pulled back and then tested it again (significance of 7715).

The initial high was at 7717 and almost instantly later, dropped like a rock by around 30 points. It then rose and tested 7715 again, eventually closing below at 7709

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).

Unless Nifty convincingly breaks 7715 and stays above it for an equally convincing amount of time (at least 7-10 days) bearish pressure will keep returning to the market, and we'll keep seeing the same ranges coming and going again. This has been happening for at least 2 months.
 

Contra

Well-Known Member
#17
Refer to my post from 22 Mar (3 weeks ago):
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.

Nifty Chart now:


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.
 
#18
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

We entered the 7842-7938 consolidation area. Seems there is more upside as long as Nifty holds 7842 today. By the way, good analysis. Keep posting.

Now I am waiting for the 7857 area to break out.
 

Contra

Well-Known Member
#19
Continuing from my previous post...
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
Nifty made an intraday high of 7842 before drifting lower and ranging. It eventually broke 7842 and made a high of 7865, closing for the day at 7850.

This puts it right in the bullish consolidation zone but below the minor resistance at 7857 (which remains important for bullish continuation).

Trade with caution now since Nifty is reaching levels last seen before the crash in Jan 2016.

If it crosses 7973, it will be net positive (green) for the year.



The important levels now for bullish continuation and push towards 8000 are:

7842
7857
7938
7973

Bearish levels are:

7776
7715
7517
7446

Signing off for now.
 

Contra

Well-Known Member
#20
Following is a brief analysis of the importance of market level interpretation based on the monthly chart. Posting for educational purposes.



Consider the monthly chart of Nifty between 2008 and 2016.

Draw a fibonacci extension between the monthly high & low of the recession year 2008.

This gives you 3 levels (rounded off) -- 6357, 7925 and 8894

Nifty started rallying from the 2250 lows of 2008 and in 2010-11, it came within striking range of 6357... but it fell back to the 4500 level.

It again started rallying and in 2013/14, it broke through 6357 and continued its upward march.

The next two fibonacci levels (7925 and 8894) were broken within a year itself, but you notice two things:

1. Nifty took around 5 years to break 6357 following the crash of 2008. Once it did that, it was able to break the next two levels (7925 & 8894) in about a year.

2. Once Nifty crossed the 8894 monthly fibonacci level, it corrected and fell to 7925, the previous fibonacci level, before rallying again in the last 2 months and attempting to reclaim 7925 again.

This is the big picture till date but, as you can see, the levels can be traced back to 2008.
 
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