Monday, December 10, 2018

Brace for a Volatile and Weak Nifty !!

Nifty will do well to protect the all important level of 10,000 tomorrow post state election results, a poor performance of BJP in poll bound states will give direction to market as we approach the 2019 elections.

Looks like an imminent bearish pattern , the H&S neckline on the weekly charts is placed at 10,000 and a breakdown below, could open up target of 8260 for Nifty in the coming months.


Nifty Weekly


On the monthly charts looks like we are in the midst Wave 4 after completing Wave 3 which ended at 11,760. Read in conjunction with the H&S target the target for Wave 4 indicate a possibility of Nifty heading towards 8200 levels.

Nifty Monthly



Friday, July 13, 2018

Watch the Magic of SBA !!


Synchronized Bullish Alignment (SBA),  an unidirectional alignment of trends is the best pattern which can give the maximum return in the shortest possible trading time frame. The  trends position themselves in such a way that no single trends is running contrary to the main  trend, and thus propel the security price in an impulsive move.

The pattern can be identified well in advance and a trade position can be initiated to take advantage of the impulse move.

Here are the charts showing the SBA+ pattern which have given stellar  returns  in July :


Friday, June 8, 2018

How to Trade Momentum with TTO ?



 The color coded twin lines on TTO changing colors to give buy and sell trades.

 Positive momentum (Blue - Buy) and negative momentum (Pink- Sell) correspond with the trigger (yellow dotted line) crossing the zero.


Any change in momentum is indicated by the trigger line moving towards zero - Time to book profit !!


Tuesday, February 6, 2018

How the Nifty Top Was Predicted ??

The series of tweets which tracked tracked Nifty to its top :

The earliest indication of a market top were available on  December 19, 2017 with a forced index movement towards 11,000 with declining trend momentum on TTO. 




On January 11, 2018 the bulls were still trying hard to move the index to 11,000 but market was already indicating tiredness as the up move was accompanied by declining A/D ratio as  Nifty also reached the multi year  upper trend line.


Nifty reached its inverse head & shoulder target of 11,000 with highly stretched technical indicators, a reversal was on cards. Momentum carried Nifty to 11,171 but the market was only looking for a trigger.


The trigger came in the form of budget which was though not entirely disappointing, but was reason enough to initiate a long awaited correction.

 A simultaneous development of better than anticipated job growth triggered fears of a high growth rate in the US and  resultant high interest rate with improved bond yield triggered a collapse on DOW.

You don't always need bad news for market corrections !!


The market dynamics have changed from buy on dips to sell on rallies as a major top has been created on Nifty at 11,171.

Friday, January 12, 2018

Are Oil Bulls Back in Business ??



#Brent Crude hit a more than three-year high on Thursday, breaking through the psychologically important $70 a barrel level for the first time since December 2014
Oil prices have been supported by stronger-than-expected demand fueled by the US recovery, worldwide economic growth on one side,  supply cuts by OPEC and Russia on the other and a series of global events that have stroked geopolitical tension.


There are a number of factors that could push oil prices higher, including supply disruptions from Iran, which faces the threat of renewed U.S. sanctions, and Venezuela, where economic crisis may hamper its ability to pump oil.
Brent  surpassed the technical target of $67 and trading at the resistance zone of around $70. A  small correction to $64 may be around the corner.

Brent Crude Daily

 A close above $70 changes the long term parameters to bullish with targets of $90-92,  backed by strong momentum as also the target for inverse head and shoulder pattern.



Brent Crude Monthly

There is strong momentum reversal with yearly trend momentum threatening to cross above zero, oil bulls may soon  be back in business. 


Brent Crude Yearly

Tuesday, December 19, 2017

NIFTY : Top at 11,000 and A Corrective 2018 ??


The Indian indices has given excellent returns during the last two years.

Nifty has moved from 6825 to 8555 during 2016 and from 7893 to 10443 during 2017 giving an absolute  return of  25% and 32% respectively. With an inverse head and shoulder target of 11,000 on monthly charts, Nifty is likely to top out by March 2018 and begin a corrective phase which is may last the entire 2018 and probably 2019 till the outcome of the general elections.

The monthly chart of Nifty indicate  a slowing momentum which is likely to cross over to negative zone marking the beginning of corrective phase in Nifty. The placement of trend oscillator is identical to  2015, which triggered a year long correction.

The correction may also coincide  with a populist budget the government may present a year ahead of the elections in 2019 and compromise on the fiscal discipline.

Nifty Monthly

Thursday, October 5, 2017

What is India VIX indicating ??

VIX (Volatility Index) generally have a negative correlation to the underlying stock/index i.e. higher the VIX, greater is the possibility of a correction and deeper will be correction.

The TTO of India VIX (monthly)  has  been hovering around zero since 2014. Though, there have been intermittent  spikes which have played out by way of minor corrections on the Nifty.

Here is what the long term trend of India VIX captured  on TTO looks like, with the long term  trends now firmly trending in bearish territory and the recent correction indicated by a spike in the trend trigger.

With long term India VIX indicating a bearish bias, will the negative correlation hold out for Nifty??

India VIX (Monthly)