Dear Friends,
Please do go through my article on DUKASCOPY Article contest for Nov 2011.The link is embdded below.
Archive for November, 2011
Nifty weekly at a previous support level
Nifty weekly chart is on a heavy bearish mood.We had atleast 3 opportunities to take shorts when it touched upper resistance trendline. However by close of last week it is at a previous tested levels.Hence one should not open any shorts immediately. Since there is hype everywhere that it’s at 2 year low ,the punters will try to pull it back and panicking existing shorts.Either we should wait for a pullback to 38.2% or 50% or wait for it to touch upper resistance trendline.Other case is when it breaks the low of last week – we can take fresh shorts.
As per the classical approach all unfilled gaps have to be filled. Hence as per my view nifty has to eventually fill the gap created at 3750 to 3925 (the gap between 2 horizontal lines marked in the chart).
On daily chart No 3 and no 11 were magnificent shorting opportunities with very small risk. However the theory of Media, brokers “Buy at every dip” proved to be a costly affair for most of the investors. When it was time to sell majority were buying!! When the Nifty gapped up heavily to 5400 I have suggested to few friends that it is at resistance level and may drop heavily, still people thought gap up was a sign of strength and went long!! In market margin for error is very less. will elaborate more on this next week. Now since support of 4750 was broken now the same will remain as stiff resistance. Hence one should wait till retest gets completed.
EU is nearing a swing low
On weekly chart EU made 3 major lower highs .after a steep decline it is nearing a support trendline as well as previous swing low.
DAILY CONFIRMS WEEKLY
The daily chart is in confirmity with weekly suggesting that we have a support at 3150 levels. Once this support is broken we may head to 2900 and then to 2600 which are base point for successive previous rallies.
WE ARE IN A 4TH WAVE
The eclipses marked show the waves of current downmove.aparently we are in a 4th wave. As of yesterday, there was not any sign of reversal on this timeframe too.
WE HAD A SUCCESSFULL RETEST AT 3300
A Candle marked in arrow with long upper wick represents successful retest of 3300 levels.
Unless until we have any unusual event, we are heading for 3150 and one should be to happy to book at least major portion of the profit and then wait for either breakdown or reversal and then take the trading decisions accordingly.
GU WEEKLY IN A STRONG DOWN MOVE
Weekly made 1,2,3 lower highs and then the current steep move signals strong downward sentiments. 5430 to 5250 was previous support.
GU daily is in a steep decline
On daily chart the last Fib retracement was deep up to 61.8% .Throughout last week the daily bars never made an attempt to show any upward movements.Consecutive 5 bars in red indicating the depth of the downward movement.
4 hour ends in a bearish Engulf
At 5430 levels 4 hour chart made a tiny pin bar indicating a small support ( marked as no 1 ) . However it ended up in a successful retest at 5500 levels resulting in a bearish engulf bar ( Marked as no 2 ).This means we are looking for more downmove.We look for longs only once it breaks the high of this Bearish engulf bar.
1 Hour made a big pin
For hourly chart traders ,there was a big pin at 5430 (Marked as No 1 ) The shooting star Marked as No 2) indicates that there is stiff resistance at 5500 and the major even next week will be breaking the low of the Pin bar ( Marked as No 3 ) which is likely to take the price to 5250 levels.
I welcome all to my new forex blog.
Regards
Raghav
4xraghav 