Technical

Analysis
Review
03-10-2014
Review_03/10/14 - ( Rating - 9/15 ) Positive - High Risk - Rupee is Appriciating / Nifty on verge of Breaking out into Bull Market / AD is +ve / TRIN is -ve / Net 52 WK Hi/Low is
+ve / Bonds is +Ve (--) Big Picture is Positve.
| 0 is extreme -ve | 1 is -ve | 2 is Netural | 3 is +ve | 4 is extreme +ve |
Nifty - ( 3/4 ) Move From 4500 (19-12-2011) to 5631 (22-02-2012) is Uptrend &
there was retracement upto 4761 (61.8% Retracement) upto 05-06-2012
Market Restarted Uptrend from 4761 (05-06-2012) to 6110 (29-01-2013) There was
correction from 6110 (29-01-2013) Upto 5477 (10-04-2013)
After Entire Move from 5477 (10-04-2013) to 6229 (20-05-2013) There was correction
in Uptrend (as Higher Low is formed at 5570 on 25-06-2013 after Neckline of 5950 of
Fresh H & S is Broken Measured Decline is upto 5700 (78.6 % Rectracement of 5477 to
6229)
Lower High Lower Low Trend (Down Trend from 6229 (20-05-2013) to 5565 (24-06-
2013). Retest & Double Top Was From 5565 (24-06-2013) & Ended at 6077.79 ( 23-07-
2013 ). Another Lower High is Created at 5742.29 (14-08-2013)
Indian Rupee - ( 3/4 ) Rupee Breakout from Symmetrical triangle Pattern. $ is in a
Bull Maket v/s Rupee Depreciation.Rupee had Retracement from Top to 61.37 on 03-
08-2014. Rupee is consolidating into a Range at Demand Level from Weekly
Timeframe.A Breakout from Range is awaited
Supply Zone at 1) 69.228 (68.860) 68.578 2) 64.074 (63.669) 63.206
Demand Zone are at 1) 61.154 (60.720) 60.373 & 2) 59.368 (59.044) 58.688
It is notable that the entire activity of previous 4 Months is contained into the range of
August Huge Candle & it is unable to takeout the lows of that August candle.On Daily
TF the price has broken on Upside. It is Notable that $ Index has Given a Breakout
from Weekly Demand Zone & $ is expected to Raise against all Currencies (Trouble for
Rupee) Also With Growing Crises senerio Green Buck (has been considered to be the
Hedge (Preferred Vehicle For Cash).
Dimensions
Demand Levels are 1) 7320 7245 7130 7050 7000 6860 6680 6630 6520 6480 -
6354 (6228.45) 6187.80 2) 6133 (6100) 6102 3) 5807 (5791) 5780 4) 5755.28 to
5714.63 5) 5550.13 (5506.50) 5474.97 6) 5276.86 - 5211.20 7) 5128.09 (5079.67)
5032.70 8) 4842.27 4770.73
Price Major Trend line break from Historic Pivot Highs of 6154 - 6134 is broken on
the Up side & retesting the Trendline break from above,Measured up move of Break
of Ascending Triangle is Very high at 7782 (38.2%) (Very Difficult - Down Side Break is
very Low 3345 (50%) & 2864 (61.8%))
Volume Volumes are in increasing Trend.In Oct series Nifty future added 1.98 lakh
position in Open Interest and this accounts to 1.26 % of Total Open Interest in Oct
series.The Nifty Oct series is trading at 34.35 Rs premium to Underlying . In derivative
cumulatively for all series contract Nifty future net added 2.48 lakh position in open
interest and this accounts to 1.49 % of Total Open Interest in all series and
cumulatively trading in average premium of 82.43 Rs to Underlying.
Open Intrest (OI) Record updated for-.Oct/01/2014-NIFTY FUTURE-CMP(7999.15)
is currently in SLIGHTLY BEAR trend. The open interest is also not increasing with trend
so be careful and premium of share is also increasing so sellers be cautious.
At current price strike the activity is tilted to call side but addition of Put is slightly
increasing at 7900 level The Nifty call option is trading at discount so sentiment at
higher level seems cautious.
NIFTY PCR (Position Wise) - 0.09 & (Money Wise) - 0.15
Previous Highs of 5742.29 (14-08-2013), 6077.79 (23-07-2013) 6142.25 (19-09-2013)
& 6189.35 (18-10-2013) is broken on Upside & Price is at Life time High of 6353 (01-11-
2013) & Parabolic Upmove has been Sucessfully Sustained after creating a Higher Low
at 5701.54 (01-10-2013) & After Inverse H&S Breakout above 6116 Price closed below
6076 (28-10-2013)
Supply Levels is - Life Highs = No Supply
Breadth Charts - ( 0/3 ) (Rating 1 for Each +ve)
SMA Trin is Between 0.8 & 0.7 indicated reduced Strength in Uptrend & space for
more stocks to Decline even tho Nifty is Rising,The series of Higher Lows in SMA10 of
TRIN can be Restored.
P & F Chart Double Bottom Breakdown Pattern occurred on 25-09-2014. 1) Rare
Double top & Inverse H&S Neckline Breakout @ 6200 --- 2) New Support 7600 &
Resistance Life Highs
Advance Decline Line (0/1) If the Nifty is rising but the number of stocks
advancing is dropping, then the trend is in trouble and may pause soon or even
reverse.
AD Line is Now falling with increase in Nifty, indicates decreased strength in Up trend
& But Line is still Low on the Curve hence it is Positive for Uptrend.
Midcaps are Raising with declining Momentum ( After Recovery from Over Sold Levels
) But some Large caps & All Index Heavy Weights are Declining with Little Momentum.
Trader's Index (TRIN Chart) (0/1) To Incorporate Volume of Advance Decline
Analysis - TRIN is unusual in that it moves opposite to the Nifty
TRIN is a ratio where 1.0 means selling and buying pressure are equal TRIN BELOW 1.0
(More Volume in stocks that are advancing) & Above 1.0 (More Volume in stocks that
are Declining
Sentiments Sentiments are now Caustious as current Breakout into Life time High
has retraced, Due to Sharp retracement in Upmove Traders are forced to cut their
Long Position,A Break on Upside from Weekly Inverse H&S & Monthly Ascending
Triangle Indicates Supreme Power for Bulls.Risk Reward would be favourable on Bear
Side upto Retest. Earnings expectations are mostly -ve
TIme After Previous F&O expiry (@ 7235.64 ) Nifty could now build Short Position
due to Sharp Pullback Rally.. Nifty's 56 Day Cycle
(19-09-2014 was a Narrow Down Doji Day) (Next Date 14-11-2014 Expect Uptrend )-->
Mid month Reversal ( 11-09-2014 was a Medium Range Bear Day )(Next Date 16-10-
2014) Quaterlies Settlement is on 3rd Friday (19-09-2014 was Narrow Range Bearish
Doji Day) (Next Date 19-12-2014)
3 Y 10 Y 30 Y
All Bonds Compleing Pullback in Uptrend. Correct Relation of 30Y ROI > 10Y ROI > 3Y ROI is achived (Caution Money is Moving to Short term Bond Market from Share
Market indicates Weekness in Economy & Flight to safety ) .. . Under Asset Rotation from Risk on (Equity Market) to Risk off (Bond Market - Security Backed by Govt)
& with Devalution of Rupee the Dollar Outage is gaining strength ( Increase of Returns in 100% Govt secured Bonds).Also Yield Returns in India are more than
corrosponding Bonds in Developed Markets.
NSE Net Monthly High & Low (0/1) More Stocks in the index making new highs
versus new lows if Number is Reducing Trend is in Trouble.The Rising New Highs
indicate Markets Buying pressure is accelerating (Environment & Trend) is Positive
There is a downward slope as "Valleys of 52 week Highs" has been broken on upside
for a 2nd Time indicating weekness in Up Trend.The "Peaks of stocks Hitting 52
Week High" Should increase for strong Up Trend
India Vix Volatility Index (or Fear Index or VIX) is a weighted measure of the implied
volatility.Market Makers hedge the market Play, the Down Volume is always a factor
& used in Direct Corelation with the VIX & They Together have Indirect corelation with
Index ie Vix & DVol is Down; Market will move Up AND Vix & DVol is Up;Market will
move Down.Indirect relation between Vix & DVOL leads to Sidewise Index
VIX is below 20 indicating Complacancy. Fear/ Volitality has increased with Up Trend
indicating Possible pullback...Volume is also High....
Indian Bonds (3/4) Indirect Correlation with Stock Market; Money Flows from Bonds to Stock for Short term Maturity (Mkt Goes up) & Vice Versa. Shorter Period
= Lower Rate (Controlled by Centeral Bank & Indirect relation to Stock Market) + Longer Period = Higher Rate (Controlled by Market)
http://stockcharts.com/h-sc/ui
Group 1 - Oil + Gas -> 33% Weight Group 2 - Natural Gas + Metal + Corn + Soya -> 42% Weight Group 3 - Others -> 25% Weight
Commodities (Negative Correlation) $CRB is in Accumulation Phase, Commodities
Crude Has Broken Down, Gold is Pushed down as $ Moved up But Copper has
regained Lost Ground ... & Geo Political Tensions are high,Now Commodities are to
Resume uptrend if $ fails to resume uptrend & continues to Decline
Currency Markets (Positive Coorrelation) Dollar is inclining Currency post the
bounce from Demand Zone & Hence Some Currencies are Reaching Supply Zone.
Japan Yen Aussie $ are Depriciating & Market are trying to Rebuild (Distribution) after
Fed's Stance of Tapering in QE & Budget Deal, Hints at Liquidity Reversal is on Hold
(Market is Build Gains on Good News) ..... Hence Global markets are in Risk Off Mode
.. Currency War has Reached Phase II where Every Currency (Developed & Other
Emerging Mkt Currencies ) are depreciating against $ to take advantage of investment
in safe Govt Secured Bond
http://
in.advf
n.com
/world
The Mighty 10 Index - Top Sector & Index weighted % Wise ( 10/10 ) Extremely Positive
INDEX HDFC Monthly - Up Trend Weekly - Up Trend Daily - Sideways Trend
FINANCE ICICIBANK Monthly - Up Trend Weekly - Up Trend Daily - Up Trend
ENERGY RELIANCE Monthly - Sideways Trend Weekly - Sideways Trend Daily - Sideways Trend
IT INFY Monthly - Up Trend Weekly - Up Trend Daily - Down Trend
FMCG ITC Monthly - Sideways Trend Weekly - Sideways Trend Daily - Sideways Trend
AUTO TATAMOTORS Monthly - Up Trend Weekly - Up Trend Daily - UpTrend
PHARMACEUTICALS SUNPHARMA Monthly - Sideways Trend Weekly - Sideways Trend Daily - Sideways Trend
CAPITAL GOODS L&T Monthly - Up Trend Weekly - Up Trend Daily - Up Trend
METALS TATASTEEL Monthly - Sideways Trend Weekly - Sideways Trend Daily - Up Trend
CEMENT ULTRACEMCO Monthly - Up Trend Weekly - Up Trend Daily - Up Trend
World Markets (Positive Coorrelation) Chinese Recover is Slow with raised
concerns on liquidity & Devalued Yunan & US Markets has Fresh Break Down
(Markets are Distributing Stocks on Good News Markets are now Ferouscliously
Selling.Europe CAG are Near Resistance DAX & FTSE have given Fresh Break down
(Global Markets are Now breaking out of Resistance. Syncronisation in Breakouts is
seen after Creating consolidation Patterns.But Global Liquidity is Drying,interest Rates
are increasing ..All Equity Markets except EMs are on Risk ON Mode
NB: These notes are just personal musings on the markets, trends etc, as a sort of reminder to me on what I thought of them at a particular point in time. They are not predictions and none should rely on them for any
investment decisions. Readers Discretion Expected. Advocate to Consult Your Financial Advisor before any Investment as Investment in any market may be Lost in its Entirety. Strictly for Entertainment Purpose Only.