Silver View

Silver has been trading in a down channel since the prices touch a record high of 50$, since
then Silver is making lower tops and lower bottoms. Recently, Silver gave a fresh breakdown below
30$ and now it may be headed to 25-26 levels in short term which can be considered as
immediate support for the precious metal. The worst case scenario possible for Silver is that
it can fall till 21-22 $.

Regards

Ankit

Tata Comm - Turn Around Signals

Tata Comm has been facing resistance at 200 dema since last 6-8 months
( see arrows ) and prices have not been able to move past beyond this
moving average. We feel that stock has given a breakout from the
triangle pattern and once it starts trading/closing above 200 dema
currently at 210 level  then stock has a potential to move UP 10-15 percent.
Stoploss would be 198 and targets on upside would be 230-250

Regards

Ankit

Analyse India

Will NIFTY stay in this falling channel for next few weeks?? - Quick Update

Regards

Ankit
Analyse India

Gold Views on Short Term & Long Term Charts

GOLD SHORT TERM VIEW:

It is evident from the chart that if Gold crosses Red Resistance line marked as (5) & breaks 1750$
level on upside then it may be headed to 1880-1900$ levels in short term. On the Downside the risk is
bigger as Gold  has already rallied so much in past 2 years, there are cluster of supports between
1600-1650$  levels and these are the following 4 reasons to support this view:

1) GREEN line ( marked as 1) - Falling trendline by joining the previous two intermediate lows is placed around
     1650- 1655 levels which should act as a immediate support.
2) BLUE line  ( markes as 2) - Rising trendline formed by joining imp lows made in Sept & Oct is also placed
     around 1650 levels
3) 200 DEMA  ( marked as 3) -  Very important moving average ( reasons already given next to Moving Average )
    is placed at 1625-1630 levels which should act as imp support on closing basis 

    Importance of 200 DEMA on daily charts: Gold has not broken this moving average since
    last 2 & 1/2 years - (April 2009 - Dec 2011 ), it has gone below this moving average on
    Intraday basis but never closed below it. One recent example is during the fall of September, 
    as you can see on charts when prices went below the RED line but closed way above it. So
    if prices of Gold give a sustained daily close below this RED - danger line then expect a huge
    long term trend change in the Yellow Metal.

4) PURPLE line ( marked as 4 ) - Rising trendline formed by joining imp lows made in July & Sept
     is placed around 1600 levels

So 1600-1650 $ should act as an important support range for Gold which if gets broken then
Gold may be headed to 10-15% correction on downside which may take it to 1400-1450 levels
 erasing some of the gains built up in last 2 years for this Precious Metal

LONG TERM VIEW ON GOLD - ON LOG SCALE
Gold has been trading in a long term channel since almost last 3 years as it is evident from this chart
on a Log scale ( Log scale takes into calculation percentage based moves and not absolute so
gives a better picture for long term trends.)

1) RED line - Formed by joining the major tops in past 3 years is indicative of the fact
     that how Gold is moving precisely in a channel since last few years and even during
     the Sept 2011 Euphoria it respected the RED line around 1900 and crashed from there
2) BLUE line - Formed by joining the major bottoms in past 3 years which are 7 in number as you can see on the chart.
    It is currently placed at 1600 levels and Gold should not break this line to resume the uptrend

So the question is - Will it also be 8th time lucky  for Gold and after taking support around
1600 levels,  it will continue its march towards upper end of the widening channel
and register its lifetime highs. But if Gold closes below 1600 levels on weekly closing
basis then the overall long term bullish trend will be over and it may
head to 1450-1300 levels in coming months.. So 1600 on the downside
and 1750 on the upside are the levels to watchout for GOLD

Regards

Ankit

Nifty falling........... Where will it stop ???

Nifty Detailed View :

Here we see that there are cluster of supports between 4450-4550 levels ( 4 reasons given ) from where Nifty should bounce back atleast till 38.2% retracement level of the entire fall from 5400 as it has done in previous major falls in this falling parallel channel

1 ) Will this low made at 4550 in Nov 2009 would be respected too ??
2 ) 50% retracement of entire rally from 2550 to 6350 is placed around 4450
3) RSI - highly oversold, at same levels where previous important lows in Nifty were formed
4) Lower end of falling channel is placed around 4500 so this should act as a major support for the Index

Regards

Ankit
Analyse India
Happy Trading !!!

Nifty Long Term view... Option writers .. Watchout !!!

Nifty View :

As you can see on the chart, Since Nov 2010 Nifty has been trading in a range which is being compressed week after week. Within next 4-5 weeks we can see Nifty
breaking out from these shackles on the either side ( preferably UP      ). The logic behind is that within this range which is narrowing week after week,  the space left
in this region can accomodate 4 more candles ( which eventually turns out to be 4 more weeks ). It is expected Nifty can breakout on the either side but a confitmation
comes only if it crosses previous intermediate highs/lows. We can see a move of 1000-1200 points in NIfty in next 6-12 months time frame i.e a 20 % move on either side.
So by this logic we may be headed to 6800-7000 on upside or 4300-4500 on downside. So for next few months naked Option writers or Option traders those who
indulge in Short Strangle & Short Straddle strategies should keep these possible moves in mind and keep a note of risk involved.

Our View: Once Nifty closes above 5750 on weekly basis, we expect it to test 5950-6050 range first and then correction is expected upto range of 5750-5800 - retest of
the breakout. And then finally starting a big rally till 6800-7000 levels. The view would be negated if Nifty closes below 5500 after giving a breakout above 5750.

Regards

Ankit
Technical Analyst
Analyse India

Nifty Positional View - 10% move on cards

Nifty View:

This is a weekly chart of Nifty and as you see that since month of November or  Feb when it made a bottom around 5200, it has been making lower highs and still holding on to precarious 5200 level on downside. One thing is for sure that we are posied for a big move in the Index on either side during next few months as we expect it will break this pattern sooner or later. Now two key levels to watchout for next few months are 5700 on upside and 5200 on downside. After strong bounceback from previous lows of 5200 Nifty is facing strong supply around the falling blue trendline zone of 5700-5750.  Only a WEEKLY close above 5700-5750 zone will give a confirmation of a bottom in place and will give start to an uptrend that can give 8-10% returns in short time

Regards

Ankit
Technical Analyst
Analyse India

Is Head and Shoulder in the making ?? Nifty - Long Term view

The answer is " YES" if Nifty breaks 5200-5250 on weekly basis. Nifty after facing strong resistance from red trendline placed at 5950 has retraced back almost 61.8% to 5500 odd level. In extreme short term supports are placed at 5470-5510. However if this broken then we may head back to bottom of our long term parallel channel which is placed around 5250-5300. This also would be neckline for the current Head and Shoulder formation which is in the making. A weekly close below 5200-5250 zone will take Nifty to sub 5000 levels of 4700-4800.

Regards

Ankit
Technical Analyst
Analyse India

Nifty supports after RBI's decision to go-for-the-kill

 

Please open the above chart

Regards

Ankit

Analyse India

Nifty Positional View

Strong Resistance zone at 5850-5900 as there are cluster of resistances in this range, Nifty is expected
to correct to 5650/5600 odd levels from this range. The correction is expected to take place after expiry

Regards

Ankit
Analyse India

Nifty Detailed View --- Invest Here or Repent Later - 2

The second point we needed to bring in focus is also given below ( please read previous post before reading this ):

As we have seen in the past and as this chart shows after making a low of 2500 in March 2009 we have not corrected more than 16.5 % in any of the major falls we have seen in past 2 years.

First Correction ->  June - July 2009 - 16.5 %
Second Correction -> Oct - Nov 2009 - 12.6%
Third Correction -> Jan - Feb 2010 - 12.4 %
Fourth Correction -> May - June 2010 - 11.6%
Fifth Correction ( the current one ) - From Nov 2010 - till now. We have already lost around 15% from the highs, considering history repeats itself and we somewhere bounce back from 16.5 % level again which again coincides with our Multiple support Rectangle zone of 5150-5350

Regards

Ankit

Nifty Detailed View --- Invest Here or Repent Later - 1

Nifty Detailed View:

Last time when we talked about Multiple Support Zone -->> 5550 to 5650 ( refer post on 11 th Jan ) , Nifty took 3 times support from this support zone before breaking it finally.

Now after correcting almost 1000 points from the Top the view is given below ( attached with a chart ): 

5350-5150 --> It wont be a easy task for Bears to break this support zone because of the following reasons:

1) Multiple bottom formations around 5350 during July - Sept 2010
2) Solid Trendline support ( lower end of the long term channel ) @ 5150-5200 joining major bottoms formed in Nov 2009 , Feb 2010, May 2010.
3) Minor support around 5200-5300 as Nifty consolidated in this range in the month of June -July 2010 before finally giving a breakout.

A bounce is for sure from the Multiple support rectangle but it is difficult to say this bounce will turn into a Major Bottom or it will be retested again ??

If this support zone ( 5150-5350 ) is broken on closing then expect Nifty to go back from where it started to 4800-4900 which is 61.8% level of the entire rally from 2500 to 6300.

 

Trade Wisely

Regards

Ankit

Nifty -- Option Strategy

Strategy – Covered Call


We expect Nifty to find support @ 5350-5400 and a pull back is seen to 5650-5700 odd levels, though a sustained move above 5700 would be a difficult task. We recommend a Covered Call Strategy where one needs to Buy 1 lot of Nifty Feb 5500 call @ 87 and Sell 1 lot of Nifty Feb 5700 call @ 27.



Recommendation:



Long/Short Option Type Expiry Strike Price Premium Quantity

Long Call Feb – 2011 5500 87 50

Short Call Feb --2011 5700 27 50



Breakeven Points:

Decider Level : 5560

It means loss is incurred only if Nifty closes below 5560 on expiry of Feb month i.e. Till Nifty stays above 5560 this strategy would be in profit



Risk/Reward:

Max Profit: 7000/-

Max Loss: Limited ( Premium paid = 60 points = 3000/- per lot )

Investment: 33350 ( Margin of 1 lot of Nifty ( 29000 ) + Call premium paid ( 5700 strike ) )

RETURNS: Upto 20.98%

Upto 251 % ( ANNUALIZED )



Traders can keep a stoploss of 5350 on closing basis on Nifty, it is advised to exit this strategy with a minimal loss if Nifty breaches 5350 on closing basis

Have a nice trading day

 

Regards

 

Ankit

Option Strategy - Reliance

Strategy – Short Strangle

This strategy is for the stock Reliance Industries; we expect the stock to remain in a range of 920 -1020 for most part of February month. We see the current downside in the stock to get arrested at 900/920 levels and a bounce back is expected after that. Option data also suggest that there is a good amount of open interest build up seen in 940 put and 1020 call.  We recommend a Short Strangle where one needs to Short 940 put at Rs 21 and simultaneously Short 1020 call at Rs 13 and gets total premium of 34 Rs.

Breakeven Points:

Upper Breakeven Point:               1054

Lower Breakeven Point :              906

It means loss only starts if Reliance goes above 1054 or below 906 levels in the month of February

Risk/Reward:

Max Profit:         8500/-

Max Loss:            Unlimited

Investment:       76000 ( Margin of 2 lots  of Reliance Inds )

RETURNS:            Upto 11.18%

                                Upto 134 % ( ANNUALIZED )

                                                                                     

Thats what you call a v-shape chart... We again were bang on target, Nifty bounced back 120 points from our support zone 5690-5720

Stock View: HDFC

Buy Hdfc @ current levels of 660-665 and add if it dips to 650-652 with stoploss of 640 on closing basis and targets 700/720 in short term..

Have a nice trading day

Regards

Ankit

Nifty detailed View updated

 
Nifty View:

Nifty after correcting 8% in last few days has send shivers down the spine for investors as well as traders. Now talking about when it will bounce back?? The answer is that it should bounce back from 5690-5720 ( we all know - the last 2 bottoms ) . But if it sustains/closes below the above said range then u can expect a 150-200 point cut which would take it to Multiple support rectangle -- 5550- 5650.

Multiple Support Rectangle consists of:
1) 200 DEMA -- Green Line - if u check the chart, 200 dema has taken care of the last 2 bottoms made in Feb and May in 2010.
2) 200 DMA -- Orange Line
3) Last top made on the channel @ 5550 ... This was the last top made before we started the massive rally from 5400 to 6000 levels

The bounce back is likely to take place from Multiple Support Rectangle if last low @ 5700 is broken.

Have a nice trading day

Regards

Ankit

Nifty has finally given a confirmation of the breakout by closing above 6050 on weekly basis..Traders/Investors can use dips to 6050-6030 to buy.

 
Stock View: IGL

The stock has been rangebound between 300-350 odd levels since past few months. With stock having tested 350 odd level 4 times before may finally give a breakout this time with supporting vols and a convergence on the charts. Buy IGL at current levels of 340-345 ( safe traders buy only above 348-450) and add on dips to 330-335 with stoploss of 320 on closing basis and targets 390/410 in short term.

Have a nice trading day

Regards

Ankit