Charts for the Day
- Thread starter anil_s_trivedi
- Start date
- Tags 50 dma investing chart reading moving average setups ta charts
Dear amit,
What kind of simple signal from moving averages ?
- For me How stock moving up and closing above MA is more important than simply closing above it...If price is closing above 10 SMA it means the price is above average value over past 10 days...And price moving away from it means price is moving from value area generated...if its real undervalued short term traders will latch the opportunity...if institutions thinks it is undervalued they will come up with volumes...So if price closing above MA after going sideways(consolidation) it indicated traders who traded over past 'x' days are thinking its undervalued and are now buying into...So closing is important for me...But from where price is coming in also more important...
Plain price crossing moving average or crossover of two moving averages?
- No crossover signal i dont take...but it tells which timeframe trader are interested in marking higher/lower...If 10 SMA coming up above 50 SMA it indicates short term timeframe traders have aggressively marked it up...
If you notice recent run up in Yes bank...it didnt even close below 20 SMA, it tells trend is so strong that short term traders are not willing to let go price to fall down...
Now question is how long the part continues, nobody has answer...as a trend follower you focus on setup, go for it...dont predict...keep watching volume on consolidation breakdowns, moving avg breakdowns...if its severe, get out...
Also do you use a log scale for drawing trendlines and patterns?
- i use log scale for drawing trendlines...Patterns for me are more of consolidations/distributions patterns...Flat,Rectangles, wedges, triangles, H&S..all consolidation patterns...how price acting need to see...Clean bars with up volume, above avg are good for uptrends...etc...
Regarding your 52 weeks high on earlier post...Yes i do monitor them...they are good signals...but you should know when to enter...i still not comfortable with buying 52-weeks highs..not reached that point...But i monitor 60 days high-low...i mention in my earlier posts also to 'Rangarajan ji' ...how stock when is in downtrend, first challenge 60days high levels...
What kind of simple signal from moving averages ?
- For me How stock moving up and closing above MA is more important than simply closing above it...If price is closing above 10 SMA it means the price is above average value over past 10 days...And price moving away from it means price is moving from value area generated...if its real undervalued short term traders will latch the opportunity...if institutions thinks it is undervalued they will come up with volumes...So if price closing above MA after going sideways(consolidation) it indicated traders who traded over past 'x' days are thinking its undervalued and are now buying into...So closing is important for me...But from where price is coming in also more important...
Plain price crossing moving average or crossover of two moving averages?
- No crossover signal i dont take...but it tells which timeframe trader are interested in marking higher/lower...If 10 SMA coming up above 50 SMA it indicates short term timeframe traders have aggressively marked it up...
If you notice recent run up in Yes bank...it didnt even close below 20 SMA, it tells trend is so strong that short term traders are not willing to let go price to fall down...
Now question is how long the part continues, nobody has answer...as a trend follower you focus on setup, go for it...dont predict...keep watching volume on consolidation breakdowns, moving avg breakdowns...if its severe, get out...
Also do you use a log scale for drawing trendlines and patterns?
- i use log scale for drawing trendlines...Patterns for me are more of consolidations/distributions patterns...Flat,Rectangles, wedges, triangles, H&S..all consolidation patterns...how price acting need to see...Clean bars with up volume, above avg are good for uptrends...etc...
Regarding your 52 weeks high on earlier post...Yes i do monitor them...they are good signals...but you should know when to enter...i still not comfortable with buying 52-weeks highs..not reached that point...But i monitor 60 days high-low...i mention in my earlier posts also to 'Rangarajan ji' ...how stock when is in downtrend, first challenge 60days high levels...
Dear Anil Ji,
So I believe you're implying that you don't so sector analysis for positional trades rather you prefer to check stock specific price action & MA while making investments.
The reason I asked for sector specific analysis was bcoz I've seen that it's preferable to invest in sectors which are performing better than NSE index.
So as you said... I can do sector analysis of 6-8 sectors I'm interested in and check which sector is performing better than NSE and then study & invest in the top 3-4 stocks of that sector.
Pls Correct me if I'm wrong here.
Sent from my Nexus 5 using Tapatalk
So I believe you're implying that you don't so sector analysis for positional trades rather you prefer to check stock specific price action & MA while making investments.
The reason I asked for sector specific analysis was bcoz I've seen that it's preferable to invest in sectors which are performing better than NSE index.
So as you said... I can do sector analysis of 6-8 sectors I'm interested in and check which sector is performing better than NSE and then study & invest in the top 3-4 stocks of that sector.
Pls Correct me if I'm wrong here.
Sent from my Nexus 5 using Tapatalk
So I believe you're implying that you don't so sector analysis for positional trades rather you prefer to check stock specific price action & MA while making investments.
I analyze sectors those index are readily available rest i track some sectors like cement,textiles,sugar whose index is not there...so you need to check the 4-5 leaders in these sectors, to see whats going on...
The reason I asked for sector specific analysis was bcoz I've seen that it's preferable to invest in sectors which are performing better than NSE index.
You invest in sectors which are relatively performing better with market index(Nifty/Nifty500). so you are using relative strength here. I also go for it. But you need to assess stock charts also, as for ex: when sugar started to rise in aug-sept-2015 their Relative strength vs Nifty was so poor...but as they started to rise only in movember when they breached 52-weeks high they started to list in top 90+ percentile ranking in my Nifty500 list...
I dont know how you measure which sector is better performing. But i will tell you let us take a simple performance vs nifty as a criteria to short list. then rank them. Top sectors will be which is performing relatively better to nifty. but if you see the stock charts in that sector, they had already moved a great already...so point is they already had good amount of runup. So you need to choose wisely here...I preferred these stocks also, but i also try to look for stocks which had just started to turned up. So they cant be having 90+ percentile ranking in your list, but they may be near 60-70 percentile ranking...thats fair enough...
Why its important to focus on this second category is, when sector rotation is done by institutions, and if its a swift one, we miss the good stocks, and they appear in our list only when they come in 90+ percentile in our universe.
So as you said... I can do sector analysis of 6-8 sectors I'm interested in and check which sector is performing better than NSE and then study & invest in the top 3-4 stocks of that sector.
What i am saying you study performance of all sectoral indices which are readily available. Do analysis wrt Nifty. But also study top 3-4 stocks from sectors whose indices are not there...so that you dont missed run up in these sectors..ex: cement, textiles, sugar...etc..
I analyze sectors those index are readily available rest i track some sectors like cement,textiles,sugar whose index is not there...so you need to check the 4-5 leaders in these sectors, to see whats going on...
The reason I asked for sector specific analysis was bcoz I've seen that it's preferable to invest in sectors which are performing better than NSE index.
You invest in sectors which are relatively performing better with market index(Nifty/Nifty500). so you are using relative strength here. I also go for it. But you need to assess stock charts also, as for ex: when sugar started to rise in aug-sept-2015 their Relative strength vs Nifty was so poor...but as they started to rise only in movember when they breached 52-weeks high they started to list in top 90+ percentile ranking in my Nifty500 list...
I dont know how you measure which sector is better performing. But i will tell you let us take a simple performance vs nifty as a criteria to short list. then rank them. Top sectors will be which is performing relatively better to nifty. but if you see the stock charts in that sector, they had already moved a great already...so point is they already had good amount of runup. So you need to choose wisely here...I preferred these stocks also, but i also try to look for stocks which had just started to turned up. So they cant be having 90+ percentile ranking in your list, but they may be near 60-70 percentile ranking...thats fair enough...
Why its important to focus on this second category is, when sector rotation is done by institutions, and if its a swift one, we miss the good stocks, and they appear in our list only when they come in 90+ percentile in our universe.
So as you said... I can do sector analysis of 6-8 sectors I'm interested in and check which sector is performing better than NSE and then study & invest in the top 3-4 stocks of that sector.
What i am saying you study performance of all sectoral indices which are readily available. Do analysis wrt Nifty. But also study top 3-4 stocks from sectors whose indices are not there...so that you dont missed run up in these sectors..ex: cement, textiles, sugar...etc..
If any body here uses Metastock he will be able to test any kind of MA combination with the software. MA results will change from time to time as market conditions do change from time to time. So it is recommended to do those tests regularly based on time frames you choose. But you should follow this and even do it.
http://www.traderji.com/general-trading-investing-chat/101582-glossary-terminology.html
I think this will clear your lot of confusing,as it clears my.
MA - moving averages
EMA - exponential moving average
I think this will clear your lot of confusing,as it clears my.
MA - moving averages
EMA - exponential moving average
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