Trading Diary - Using MACD, ADX for September Series

[akhill]

If we observe the candle pattern for nifty or BNF today, it resembles the piercing pattern, which is not really considered as bullish, but might signal a trend reversal on the bullish side.

The piercing pattern is made up of two candlesticks, the first black and the second white. Both candlesticks should have fairly large bodies and the shadows are usually, but not necessarily, small or nonexistent. The white candlestick must open below the previous close and close above the midpoint of the black candlestick's body. A close below the midpoint might qualify as a reversal, but would not be considered as bullish.

Example:

 

[akhill]

Even, the historic nifty trends are also showing the piercing pattern to be a powerful one to turn into bullish. It may or may not happen tomorrow, but i am bullish right now because the MACD is also indicating a bullish trend in the short term (about 60 to 70 points in NIFTY)

should see how it works out in next 3 or 4 trading days.

 

[akhill]

Pictorial explanation of Piercing pattern

 

[akhill]

But this cannot be really considered bullish, because today is the last day of expiry. For now, i take chances on the long side.

 

[akhill]

The mid-point of yesterday's Nifty candle is at 5314.1 , whereas today's nifty closed at 5315.05 , which is only one point above yesday's midpoint. so, i am not really bullish on the market, but i expect to see an upmove of 50 to 60 points, and if it happens, the MACD will signal a clear long signal.

 

[akhill]

The above picture shows a combination of fibonacci retracements and fibonacci timezones.

As i said earlier, Nifty is supposed to to reach the 5392 level by sep 7th. The nearest supports for nifty are in the range 5297 - 5304 (may go up to 5280 - 5290 also which is considered as support level by many experts)

If it does reach the first resistance level of 5353 in one or two trading days,(by monday precisely) and survive above that, then chances are there to hit 5393, the next resistance (weaker than 5353). If Nifty reaches 5360, MACD will be oriented to cut the signal line from below, triggering a long signal, and we can expect nifty to go up to 5421 by friday next week.

This is just my understanding and market may dip right tomorrow based on GDP data or QE3. I am just basing my arguments/bias only on technicals.

If there are any flaws in my analysis, seniors please guide me in the right way. I am more determined to correct my mistakes and increase my accuracy.


In case Nifty opens below 5290 tomorrow, and cannot move above 5300, i guess it will go down to next support level 5216 (5230 is the experts' call) in mid short term.

 

[akhill]

Last for the day

Piercing pattern observed in sensex during 2010.

and the piercing pattern observed today in sensex

Nitey nite folks.. gotta see what market has in store for us tomorrow.

 

[akhill]

Today the first half of the market might run with negative bias and touch 5280 (+/- 10) and later may proceed to close upward i presume. watching closely for GDP data though.

 

[akhill]

nifty below 5280 spot

 

[akhill]

GDP news analysis by me was wrong. so edited