August 13, 2010

  • There is a triangle formation in apples daily chart.
  • Break of the triangle in line chart should be confirmed by a daily close below the support line.
  • The stock is trading below its 50 DMA. 

  • Dow Jones 15 minutes chart is trading in a channel.
  • The channel may give an early indication to which side the daily chart is going to go
  • Price in daily chart is holding on to 50 DMA.
  • Dow Jones Futures 4 hour chart with important support levels.
  • Right now its trading between 10225-10366 levels. 
  • An up move from here may hit resistance near 10366 levels.
  • When this triangle formed i was expecting a 50 point move towards the break out side.
  • So from 5425 this should touch 5475 but a partial booking of profits to secure profits is suggested.

  • Triangle breaks out on the upside.
  • The up move will gather momentum above 5440. An hourly close above 5440 will give confidence for the bulls.
  • If gets resisted at 5440 price will come back to the break out point.

  • Nifty managed to come back above the 5 day low ema and closed above it.
  • But nifty for the second day has closed below 20 DAY SMA. And the more it trades below its daily 20 SMA the more bearish it gets. 
  • The stochastic indicator has been showing negative divergence for quite sometime without any major correction. So If the price falls below 5350 the negative divergence will take effect.
  • Nifty futures is showing a triangle in  its 5 minutes chart.
  • Dow Jones is taking a pause at the 50 DMA.
  • But the support may only last till the next wave of selling that may come today.
  • From 10700 to 10300 support levels are broken in a hurry so a reversal may not come now. 
  • If 50 DMA breaks 10000 will be seen.
  • Dow Jones futures 30 minutes chart in a triangle.
  • Break out can give close to 100 points towards the break out side.
  • False breakouts are also possible. Triangles are known to do that. But dow is 400 points down from 10700 so an upper break out can be traded for a small bounce.


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My Favourite Quote

"All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical formations and patterns recur on a constant basis."
—Jesse Livermore