Simple analysis

RSI · #1 16th February 2008, 09:15 PM

Hello all,

I was going through some charts, of course in a random manner. I noticed DLF chart. I have made a few comments on it. There are many more comments to be made. But if all of them are written there, it will clutter the chart. Basically these charts have been posted for newbies who have read materials posted by Saint. Also note that analysis is made without using any indicator. Simple price volume analysis with support and resistance. A multi timeframe analysis is also added (i.e. weekly chart) Hope this helps at least some newbies by way of practical lesson.

Please note. I do not have any particular reason or love towards DLF scrip. I donot have any position in DLF either long or short and I am not interested in this company also. Selection of the chart is just random. Last but not least, do not forget that there is absolutely nothing guaranteed in trading so have your stoplosses in place. You may note some comments on weekly charts as to my guess about its possible future trend. But that is not a recommendation either to take position or to liquidate an existing position. Charts are posted for learning purposes only. Please note that.

The main attempt in posting these charts is to motivate other experienced members here to post charts with their valuable comments so that all of us can learn some thing everyday in this forum. Otherwise “buy xyz – sureshot call – it will double in xxx days” will be rampant in Traderji. No one will learn anything from these types of calls or threads. I donot claim to be an expert. I am also a learner.
Thanks and regards
R. S. Iyer

NAVEEVIa · #2 17th February 2008, 12:00 AM

How did you arrive at the resistance zone on weekly
Did you fixed target based on RSB
If i am correct there is lot of volume on first candle
I wish somebody explain the chart with each bar & putting things into context
A Price Volume based thread would be most welcome
Thanks
Naveen

gkjha123 · #3 17th February 2008, 08:07 AM

Dear RS

'Knife thru butter' should neither be surprising nor a case for too much analysis. If you recollect that period was one of unwinding over-leveraged positions. I think we need to discount such 'abnormal' periods for technical analysis.
Then again, I am a novice.
What say?

GK Jha

RSI · #4 17th February 2008, 09:42 AM

Quote:

Originally Posted by NAVEEVIa

How did you arrive at the resistance zone on weekly
Did you fixed target based on RSB
If i am correct there is lot of volume on first candle
I wish somebody explain the chart with each bar & putting things into context
A Price Volume based thread would be most welcome
Thanks
Naveen

Naveen,
Look at the weekly chart. The boxed area is an area where demand and supply was in balance. If you observe it still closely, there is RBS also.
I am sorry for using the word "target". Proper expressing should be that the next possible or next area where the prices are heading is the area marked as target. I think you meant RBS and not RSB. As I made clear in my earlier post, the target area is the next possibility. It is not a rule that it should obey it. We have to analyse the situation everyday as and when new candles are added to the chart. Look at as many charts as possible. SBR and RSB will happen time and again. Professional traders rely on them.

RSI · #5 17th February 2008, 09:53 AM

Quote:

Originally Posted by gkjha123

Dear RS

'Knife thru butter' should neither be surprising nor a case for too much analysis. If you recollect that period was one of unwinding over-leveraged positions. I think we need to discount such 'abnormal' periods for technical analysis.
Then again, I am a novice.
What say?

GK Jha

Dear GK,

You should not mix up charts of sensex and nifty or for that matter market movement as a whole with the charts of individual stocks and try to draw conclusion or explain movement in these charts from the movement found in other charts. If you do that, you will have only confusions and confusions. Support and resistance areas in DLF charts will be respected and obeyed because it is support and resistance areas in DLF chart. Not because sensex or nifty or for that matter market as a whole moved in a particular fashion. I request you to do a simple test. Check whether sensex or nifty or market as whole had similar support or resistance on each date or time when DLF had support or resistance. If it did not, then there is no reason to adopt this method of analysis this time. If you do that next time you will be confused as to when should you adopt this method and when you should not. Hope this helps.
R. S. Iyer

rangarajan · #6 17th February 2008, 10:40 PM

Nice analysis Iyer.Pl keep posting

RSI · #7 19th February 2008, 09:58 PM

Almost all of you have read it and some might have even forgotten it. In case you have forgotten it, let me take the privilege of reminding these points to those who have forgotten it.

In any bar/candle there are four points to be observed first. These are

1. Open – This belongs to the novice and inexperienced traders
2. High – This depicts the strength of the bulls
3. Low – This depicts the strength of the bears
4. Close – This is the handiwork of the professionals.

RSI · #8 19th February 2008, 09:59 PM

I have posted the updated chart of DLF with a few comments and a new trendline. As and when I see something interesting, I will post the chart. Let us learn together. If I commit any mistake, do not hesitate to call a spade as spade.
Thanks and regards
R. S. Iyer

chintan786 · #9 20th February 2008, 12:25 AM

what is going on...

On side nifty is forming Higher lows but not forming higher highs..abv the present levels of Nifty there many resistance. lets hope this time again it will form higher highs..

@RSi.. good work.. hope u will not strt Blog in future.. and remain with us.

plz find nifty charts enclosed with it.. and comment upon..if u ppl find anything interesting in it.

chintan

RSI · #10 20th February 2008, 02:32 PM

Chintan,
Usually what happens is that once some one posts charts of different stocks and comments are made. There after there is absolutely no follow up. We forget about it after a few hours or may be a few days. Ananlysis once made is not a rule written on stone. We have to change it as the market dictates us. If I have to change my analysis earlier made, then I will have come up with reasons as to why I am changing my views. Only then we understand the nitty gritty of analysis. That is why I took up one randum chart and continuing with it. If I start posting comments upon many charts, I will not be able to keep track of them and soon this thread will loose its direction and the purpose for which it has been started. I am sending a private message to you with regard to the chart posted by you. Hope you will understand my difficulties. Thanks for showing interest in this thread. Hope you will continue to read on later posts as well. If you have any doubts with regard to any of the points discussed here, do not hesitate to ask it. I shall try my level best to answer it. All I want to say is let us not deviate from the purpose for which we have started this thread.