19th Dec

The Fast Fall did materialise today morning and Nifty fell to 4556 .

I see +ve divergence in 9 Rsi  chart (above) but this divergence is there for last 3-4 days .
There is a bounce coming soon ..when ?

As the 5 sma moves above 10 sma as seen in the chart , it has made me come out of my short position  .

As far as Moving average channel is considered , I will wait for the red signal line here to cross over the yellow line for a buy signal.

I will wait for a good set up before taking any other positions .

Hour high ema at 4618 presently ,

As prices above hour low ema at 4576 they indicated a buy and as prices close above Hour high ema at 4618 then it will be buy and hold .

Price currently  very close to day high at 4623 if they close above 4600 , it will give a very small body with gap down on day chart .

and If we open Gap up tomorow , then Morning star may be in the making .

Day low ema at 4659 , prices crossing this lvl and closing above it  will generate a "buy" signal for me .

Prices moving below 4575 and closing , generate a "sell" for me.

Elliott Wave.

Long term chart                                                           Weekly Nifty chart .

There are 2 possibilities presently . We are in wave C to down in 5 waves out of which i , ii done ii going on iv and v to follow  .

Let me put it here again

A- 5400-4639 =761

    B- 4639-5099 = 460

    C is on (Down) in 5 waves , Expectation = A = 761 which comes to 4338 !!!!!!

           1   5099-4728 =371

           2   was a irregular flat , whose wave c could not do the expected that is above wave b so effects could be very implusive wave 3 ...I guess which we saw today.
      so 2 = 90
             a-4728-4839
             b-4839-4673
             c-4673-4818 ( fell short of expectation which was above 4839 atleast)
Now 3 going on in 5 waves min target = 1 = 371 which comes to 4447
 we touched 4556 (19 dec)

The other possibility ( In RED) is that we are almost finishing b.B and will start c.B soon ( This B is a irregular flat where in b.B went below the start of a.b) so possibilities of c.B touching lvls higher than high of b.B ( 5099).

MA Channel Setting

As I was backtesting I see lots of whipsaws and small profits when I plot 5 high and 5 low channel . Plotting 20 High and 20 Low ema/sma with 5 period as the signal line lets you stay  in the trade for longer time and wipsaws are less though there are wipsaw there as well . One can fine tune it with plotting 10 period MA as well on the same chart and Part booking at 5 and 10 MA crossover.I will try to follow this for some time.Have a look

What a Fall!!

OMG !! what a fall

So covering at 4782 was really good .

Look at the channels now.

Going short below

 first below hour low ema and then below day low ema would have been great , but I did not do that .

Currently nifty has broken the Low at 4639 and touched 4628 today , very bearish sceen as seen by me .

On the Higher counts I am counting as

ABC zigzag from 5400

    A- 5400-4639 =761

    B- 4639-5099 = 460

    C is on (Down) in 5 waves , Expectation = A = 761 which comes to 4338 !!!!!!

           1   5099-4728 =371

           2   was a irregular flat , whose wave c could not do the expected that is above wave b so effects could be very implusive wave 3 ...I guess which we saw today.
      so 2 = 90
             a-4728-4839
             b-4839-4673
             c-4673-4818 ( fell short of expectation which was above 4839 atleast)
Now 3 going on in 5 waves min target = 1 = 371 which comes to 4447
 we touched 4628 today 16th dec.
I think i is done of this 3 as
           i- 4818-4628=190  
          ii-4628-4671* is going on
         Retracement lvls for this corrective wave can be
         23.6%(4673) Almost done today
         38.2%(4701)
         50%(4723)
         61.8%(4745)Golden ratio
         78.6%(4777)
Lets see what Monday brings.

Divergence 
A good +ve divergence is also seen in 9 rsi hour chart .

I can see fast fall as well here with 7 and 34 Sma .

Intraday update1

update at 1:00
5 ema did not cross 10 ema . Now that nifty bounced back Lets see if exiting the trade was a good move , or paitiently waiting for 5 ema to cross 10 would have giving higher gains .
---------------------------------------------------------------------------------------
at 12:30
My obervation is if I wait for 5 ema to cross below the 10 ema for exit I am lossing a few points , compared to if I exit on a close below 5 ema . ( 5 min or 15 min candle)
As we entered this position at 4745 looking at the Hour MA channel , exit looking at Min candle can be more appropriate.
This is what I think at present . More observation is reqd to say it with more confidence.

So saying that , currently Trailing SL of 4886 hits as Nifty spot goes below it .
I could have exited in various ways lets see which gives max gains.

1. The 5 min candle at 11:55 did close (4782) below the 5 ema then @ 4786 ...so close position at 4782 .
2. The 15 min candle at 12:00 did close (4779) below the 5 ema 4786 ...so close position at 4779.
3. Wait for 5 ema to cross below 10 ema.
4. As the trigger line (yellow ) comes back in the channel below 5 hour high ema . accordingly close position at 4782 .

Lets see which one is most beneficial .

Presently closed position at 4782 .

Date	Position	Size	Entry	Sl	Part/Booking	Exit	P/L
15-Dec-11	Buy	100	4745	4700
16-Dec-11					50	4795	50
					50	4782	37
							+87

Update on yesterdays Long.

Carrying the trade table ahead

Date	Position	Size	Entry	Sl	Part/Booking	Exit	P/L
15-Dec-11	Buy	100	4745	4700
16-Dec-11					50	4795	50

I will carry the the 2nd lot till the 5 ema is above 10 ema (Black Line) .

15/12 observation

Yet another +ve divergence seen in hourly charts , with 14 RSI  Also nifty at the upper band of the channel . Moving average channels ( 5hour high , 5 hour Low) has again given a buy today at 2 'oclock close .
at 4840-4850 lvls . Stop loss at close below 5 Hour low.

Let me maintain a trade table for MA Hour channel .

Date	Position	Size	Entry	Sl	Exit	P/L
15-Dec-11	Buy	100	4745	4700

EOD 14/12 Larger Trend

Monthly trend is down . Weekly it is down and daily it is down . Yesterday hour frame did turn up , but again looking at today's last 2 hours , it seems to be trying to allign with the larger trend . Down .

Moving average channel in hour frame triggered abuy towads the end of day yesterday and today again it is reversing direction and triggered a sell with the 3 hour close candle.

 Now if we look at the channels in daily time frame , we see that the sell triggered close to 5400 is still on ,

Todays action provided another oppertunity to enter the short trade as the hour prices broke below the 5 hour low ema .
Also the Zero line reversal is coming to mind , when the macd line starts to reverse just after touching zero line it is very bearish and vise versa .

As we see here in the above chart , macd line reached zero line and reversed again . lets see the action tomorow .
Since the trend in the higher TF is down , hourly bouces can be used to sell .

Outlook for 14.12

As we see in the above chart , the MA bands suggested a buy towards the end of the day As the Pink signal line crossed above the 5 High ema ,and  the rally from 4730 lvls to 4820+ lvls.
In the EOD chart below the signal is not yet triggered. Tomorrow as the prices move above the low ema presently at 4810 lvls  one can looking at hourly charts also , look for a good entry to buy.

+ve Divergence was seen , in Hour chart with 9 Rsi , 14 Rsi , Fast macd today and the rally followed it .
9 Rsi moved from below 20 mark above it .

Fast Macd is yet to trigger the buy signal , I am keeping an eye on the signal line , it is very close to 0 line ,if you see it is just below it.As signal line crosses the 0 line it is considered bullish.Let us see if it crosses tomorow.

Fast Stochastic is poised as if it is just about to cross the signal line , yet another thing to keep an eye on .

Emas have a bearish allignment . Shorter term emas are lying lower than their higher term emas .

What I understand is if we see upside direction tomorw then it will confirm the MA cross over , also will support the +ve divergence and macd signal line will do zero crossover.

EOD 12/12/2011

In the above chart I have plotted simply 5 hour High MA(Blue ) , 5 hour Low MA( Black ) bands and the Pink line is the daily closing of pirces. A very simple trading strategy can be as the prices move above the blue band it is Buy signal and vise versa .



For past two trading sessions it is giving very good returns ,

today morning a sell signal was generated as the pink line crossed the black line to down .I keep updating the prices at the end of every 15 mins in my charts so that I can keep trailing my SL . One can buy min 2 lots for the max returns .

EW : We might be in the 3rd wave of C to down . looking at the implusive behaviour of the waves today.

 we can count C in 5 waves  as

1.5099-4841 =258

2.4841-4918=77

3 presently going on in 5 waves .( should travel min = 258 ====4660)

Up Or DOwn ??

9^th Dec

Update @ 2:30 pm
Gap almost filled . Island reversal gets Invalidated  .
ALso looks like a green candle  today if so , then evening star also gets invalidated.

The direction I was trying to trade was right today , that is long , but it took my stop loss at day low by just 2 points and jumped again close to 70 points and I ended up lossing .
My moving average band , Triggered a buy . ALso trendline is suggesting that the down move from  5099 to 4841 is over and now correction for this move is on.
23.6% is done today


Trade Initiated Buy at 4873 NS Sl= 4844 Day Low.
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WLema @ 4864 . Nifty opened at 4870 may take support at WLema 4864  and bounce .

EW point of view ,  we may have completed B at 5099 and started C down in 5 waves . 1^st wave over at 4843 today(9^th Dec) and now 2^nd wave to up in 3 waves as corrective wave may start .

A-     5385-4639

B-      4639-5099 (did the golden ratio and then fell from there)

C-      Ongoing in 5 waves

i-5099-4841=258

ii-4903(23.6%)   4941(38.2)   4971(50)   5001(61.8)  5045(78.6) Probabilties exists.

       49012 Done .

Bearish scenario

Candle Pattern

Nifty opened Gap down at 4870 , not filling the last gap at 4866-4918 , If we do not fill this Gap today then it creates and Island reversal , which is very Bearish . If Gap gets filled  today then gets invalidated.

Also yesterday EOD candle made an evening star  which is also bearish . Follow up is reqd. as another red candle today.

Volumes

Eod 8^th Dec Volumes below average .

Indicators ( Indicating bearishness)

Stochastic – Sell in daily TF  ;

Macd yet to trigger a sell in daily time frame , but with todays gap down it has triggered a sell .

RSI – turned down from 80 mark .

Today 's ORB – (4872-4843) As I write this Orb broken to up so possibilities that we are in C.ii to up

so the candle pattern which is suggesting movement down ....needs follow up ...

Let us see.