Charts for the Day

I see that Anil. Also NIFTY didn't break today and was ending almost same level. My next paper trade is for BHEL. I am looking at going long in BHEL. Request your comment as per the chart attached.

BHEL today close 226.9

ADX raising
RSI in 40
Stochastic in 20-30 level
Broken trend line (1) as support
Trend line (2) is also support almost at the same level.

Going Long with SL - 213 (previous low after breaking support). I don't know how to calculate TGT for this . Your advice will be highly helpful.

Dear Anil,
Could you pl give me your opinion on hexaware technologies. I am having 3 lots of Nov call (Strike Price 120) at an average of Rs. 3.7. Also I have 2 lots of futures at Rs. 114. Your quick response would be of great help.
Thanks

how to know about the inverted head and shoulders pattern?

Dear Esse,

Sorry friend for delayed reply, was busy in some personal work. As you are holding futures long, i dont see any reason to initiate longs closer to 200 DMA,what you initiated at 114 or so. As from weekly charts stock got correcting from a huge divergence in RSI, so a higher timeframe weakness already hammered it upto 108 levels.
Now from what i see from daily charts, a likely bounce till 116-118 can be there, so a good thing will be exit at those levels.
A supporting fact is, in weekly chart a last week candle is a good reversal one, so lets see for this week closing should be above 112. If monthly closing above 111.5 a likely revisit to 120 levels.

Dear Rohit,

I am unable to understand your question. Inv H&S pattern is more effective if previous trend is downtrend, as you are expecting a reversal here.
A likely formation of same in momentum indicators like RSI/MACD will be good sign.

I also have some optons call at 120 strike price he prices of which have depleted substantially. What should be my strategy in this?

Dear Esse,

You are super bullish in the scrip, as you are long in futures as well options.
I dont know your trading experience, but as an trader experience of myself, would like to advise you, stay away from options unless you understand game well. Options is altogether a different thing, smart traders eat premium as time decay.
For futures as well options, please keep stoploss, or else you will be making someone else's bank account heavy. Dont throw money easily to other smart traders, its a hard earned money. Understand its value. Keep your trading plan ready, and book partial profit and be ruthless to have a stoploss. I have seen many part timers, go long in futures and see scrip falling like hell, and they doing rollover every month. Their money is locked, waiting for initial price to exit.

Thanks for your input bhai. I guess am learning faster (atleast I hope).

Back to NIFTY I was getting clarification from you.

I haven't closed my PT 1 (short in NIFTY). I am trying to approach my paper trading as the way I would do real trade.

My initial target (off-course from the Fibonacci retracement you mentioned) is at 5489. I am still holding the position (just in paper though). I am looking at a price target of 5514 (38.2% level).

Moving my SL from 5722 to 5639 based on TL 3.

Reason to hold
-----------------
-DX moving ahead
EMA 15 moving above EMA 3
MACD below Signal
RSI moving down
%D raising above %K

As have been asking before, would request your comment on whether what I am doing is correct.

Attaching chart.


Thanks Much
Sreeram

Anil,
One more thought and need your input.

I drew three Fibonacci Retracement from the pivotal high (Oct 5th) to Pivotal Low 1 (June 4th), PL2 (July 26th) & PL3 (Sep 6th).

While looking at the retracement, it formed in below pattern

FR 1
Retracement 1 at 78.6% (1)
Retracement 2 at 61.8% (2)

FR2
Retracement 1 at 78.6% (3)
Retracement 2 at 61.8% (4)

FR3
Retracement 1 at 78.6% (5)
Shall we expect Retracment 2 at 61.8%. Around 5450 level?

Thanks
Sreeram