May 14, 2011

  • Daily chart is showing a bearish flag pattern. 
  • Indicator readings are in oversold region. This can be tricky, if the bearish flag wins then the trend will continue that means the oversold indicators will stay oversold.
  • Price is below 50 and 20 day moving average. Yesterday price attempted to stay above 5 day high ema and got resisted.
  • The weekly chart is showing a pause in selling. But for bulls they have to stay above 20 week moving average to push higher. 
  • So for Next week One has to watch the resistance and support line of the bearish flag shown above. Breakout traders should wait to see these line gets broken and close outside. Others can try to trade the range with small stop loss.
  • Yesterday Nifty gave a nice short entry during intraday. I was not able to post the chart because of the blogger problem : YESTERDAY'S INTRADAY POST

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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