Sunday, July 22, 2012

Trading Nifty

It has been a choppy , low range , low volatility Market since the start of July series. The Monthly range so far has been a poor 180 points apprx. Since last few months ,after making a top at 5630, we are seeing the trading with no followups of any breakouts on either side , important levels and averages being whipsawed , range bound short term trading and now small daily ranges and low volatility. It has been a boring market to trade lately .

The Daily Chart seems to be forming a Triangle Pattern in which there are lots of whipsaws , three wave moves and low volumes .

Since the recent low of 4770 , we seem to have done a three wave up move till 5348 .
Now from the top of 5348 we  may be doing a three wave move down to either retrace the last up move as in chart below or a larger move down towards the lower trendline of the Triangle as in daily chart.

For short term trading , this may be a probability :

The 5 min chart points to weakness in initial sessions of the next week .

Concluding ,

The Short term bias is down . The initial Support may come at 5130-60 and Resistance near 5260-5300 for the next week . The series may expire within this range also .
A direction for a larger move in short term may come in first week of next series , which may be down , if 5300 is not crossed on closing basis, targeting near 5000 levels .


Kumar Technicals said...

Dear RV!

Thanx once again for this nice & informative post, its really worthy of praise.



AAR VEE said...

Thanks Kumarji for going through and leaving encouraging comment.


SP said...

Very useful post indeed. Every chart speaks about your ability to understand the market moves. Thanks again for wonderful charts.

AAR VEE said...


Thanks for going through the post.

@ All ,

Though the bias is down and 5130 level was expected. It has broken through it and is closing below it. The expected 5 min and hrly +ve diversion were invalidated after initial trading suggesting an extended downmove to unfold and waves subdividing.(This may be a subwave 3 ) so correction may test near 50dma level of 5095 .Hrly RSI reading is at exhaustion suggesting temp low at least is nearby.

karthikg said...

Agreed Aarvee.The break of 5130 levels suggest and the kind of capitulation moves in some stocks suggest that the bottom is near and though we could move up a bit from here, in all likely the bottom formation is gonna take 3-4 more days and in the range of 5000-5090 should be the bottom and the move towards 5900 should begin.

karthikg said...

My timing models are a suspect but here goes-- Nifty 5900 by Sept 13 2012 give or take a few days:-)