Friday, May 30, 2014

Successful trading also requires 10 power points or framework!

Mr. Modi has prepared 10 power points and has emphasized on governance as most important followed by focus on delivery and implementation. 
The planning and execution both are important aspects of any business or policy decisions.
Trading in stock market should be no different than preparing a 10 points agenda or planning the trade. It should be treated no different than any other business. If you want to be successful in trading prepare a 10 power points today which will take care of Trading strategy, Money management, Risk Management, Entry method, Exit strategy, Instrument type – Cash / Futures / Options, Mental setup etc. Each of these points is extremely crucial and should be well thought before entering a trade.
People think trading is simple because execution is easy but it takes lot of time, efforts, mental energy to become a successful trader. We are discussing 1 point from the 10 power points in below article. Technical analysis application is all about understanding the probabilities of market.
Nifty Elliott wave patterns, Channels, Moving averages, MACD all in one report!!!
Nifty daily chart:
The above chart shows confluence of Elliott wave counts, Channels, Moving averages, Indicators.
In today’s morning report we mentioned the following:
Nifty opened near 7315 level with a Gap down of nearly 20 points and later closed down by almost 95 points after the weak start by IT major InfosysInfosys shares fell nearly 250 points and lost nearly 8% by closing. It seems Mr. Murthy’s return is not helping shareholder and this is for 2nd time when the stock has tanked by nearly 8% in single day after he has re-joined. The investors and FIIs will be nervous seeing such behavior in a blue chip stock. Infosys has also closed below the important support of 3000 which was previously very strong resistance. If the stock price cannot move back above 3000 over next 2 to 3 days it will indicate weakness in IT sector and this time if major market reverses there will not be any defensive sector which will limit the selloff as the Pharma and FMCG sectors are also looking weak.
Nifty as expected on expiry day did result into strong movement and as soon as the previous pivotal level of 7270 was broken the selling pressure intensified and the index closed near the day’s low at 7235 levels. The selloff was witnessed across the board with almost all the sectors closing in red including the outperforming Midcap and Smallcap sectors. It will be crucial to observe if the selling pressure can intensify over next 2 to 3 days across the board or if a few sectors again start showing some outperformance.
As shown on the daily chart, the black trendline worked very well as we have been expecting and prices constantly failed to close above it. Nifty has now arrived near the blue trendline support and any move below 7200 will bring it back within the blue channel opening up further downside possibilities. For medium term trend to turn negative, break of ……….. will be very important.
As shown on 60 mins & 10 chart,….. (shown in actual report)
To know how we are reading all of the above indicators across the time frames right from daily to 60 mins to 10 mins chart on Nifty & stocks and which levels will decide reversal in the medium term trend subscribe to “The Financial Waves short term update” which provides the important aspect of technical analysis which forms an important point in the 10 points framework of Successful Trading!. For subscription option visit

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