Trading Strategies Using Technical Analysis

Which date should the meet be held?

  • February 27th 2011

    Votes: 19 59.4%
  • March 6th 2011

    Votes: 8 25.0%
  • March 13th 2011

    Votes: 5 15.6%

  • Total voters
  • Poll closed .


Well-Known Member

There are few things I wanted to say,

1. We are not in a bear market. That's why I don't think any rally here is a bear market rally. Nifty is going to make a new high this year and I strongly believe in this. The market would change it's stance from Bull to Bear when 4500 and more importantly (3900) get's taken out decisively.

2. TA assumes that the trend will continue in motion till signs emerge to suggest otherwise. As of now, there is nothing that suggests this. It is human tendency to get shaken up by such corrections and volatility. How much has been the rise since April and how much has been the correction recently ?? As traders and investors we should not draw conclusions so early.

3. What Dow is doing currently is completely different. They have a structure economic problem which is far from getting over. The recent changes in US policies do indicate that. Hence, before linking Dow with Nifty, we need to consider the economic structure of the countries in perspective. The transition of growth and benchmarking has to take place from the US to the Asian countries. Hence, the impact might be there initially, but It wont be a permanent one.

4. The RBI quarterly review released yesterday indicates that in our economic system, things are progressing well and though monitoring is still been done, there are no apparent signs of any weakness.

5. Technically Nifty has formed a high wave candle (indecision of movement) on Thursday and a strong hammer on Friday. Hence, clinging on to these levels is not such a bad idea. Volatility will be there and hence trader's should stay out. But, for long term portfolio, it is not a bad idea to accumulate stocks. If the market signals a bear move ahead, then we can liquidate always. But anticipating what the market is going to do is always fatal.


Thanks for sharing your informative views. Just to add to my earlier views :
- There is no doubt Indian economy is growing & hence medium to long term outlook on market is very positive which leaves no doubt that Nifty will touch new highs during 2010
- Short term outlook ( for month of Feb2010 ) remains pessimistic due to :
- FIIs withdrawing over 7000 crores from market during last few days. there is no
reason for them to come back just few days after withdrawing
- Dollar Index rising & threatening to cross 80+ due to which commodities will be
under severe pressure
- Obama's war on banks & Wall street has just begun ( Add China's monetary squeeze
to it )
- Next bad news is waiting to come from Europe anytime soon ( Read Greece )
- There is unlikely to be anything in Budget which can please industry

Against this backdrop Friday's Hammer in Nifty makes things interesting.

Cheers !!!

Alok Tewari


Well-Known Member

For Investment Purpose Only.

Stocks selected here are not based on any system mentioned in the thread. This is based on my own personal system which I use for my trades. Unfortunately, it is not an AFL but a customized application. Hence, I cannot release this on the forum.

P.S. Please select stocks out of these lists suiting your own investment criteria. These are pure technical play outs and I don't know whether they are fundamentally strong or not.
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Well-Known Member
RSI Divergence on Daily Charts

RSI Divergence Strategy Using Daily Charts

Tools Candlestick/Bar Chart, RSI(15)

Trade Setup On Daily chart frame, this strategy is going to give out extremely good results if you continue to stick with it. The setup is fairly easy, but you do need to monitor selective group of stocks to get a feel of their levels. Hence, this strategy does require some subjective analysis.

Time Validity - I trade this pattern only on daily charts. I use this particular time frame because divergence is more easily visible here. Once the trade is initiated, I carry forward the trades for 2-7 days.

When does it occur and How to Trade it- This pattern occurs when a stock or an index runs up quite a bit and retraces back to some level. From there on, the stock/index ralies again and makes a significant new high. It is during this high that we need to look at the RSI level. If the RSI level is significantly low than the previous high's level, then initiate short position with High of the rally as a stop loss. I have particularly used this strategy to short the Nifty recently at 5300 level which I had disclosed on this thread.

Examples - I have provided example of Nifty. Refer to the chart below to understand the setup properly.


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