Saturday, October 24, 2015

Weekly Review - 26.10.2015

Dear All,

>>> Nifty Daily Chart <<<

>>> Click the chart to see on full screen <<<

Wave X Completed @ 8328-30. If this resistance holds next week, Expect the correction to start any time soon. Else rally may extend.

>>> Nifty Hourly Chart <<<

>>> Click the chart to see on full screen <<<

Above 8320-30 - Gap to be filled till 8360.

>>> Bank Nifty Hourly Chart <<<

>>> Click the chart to see on full screen <<<

Its still on a complicated corrective upmove. Let's wait for it to get completed.

>>> Stocks Updates - Note <<<

We are still Holding all our Stocks as we have posted chart for last 2 weeks, hence not updating any of it. We continue to carry Short till SL reaches its resistance (SL). So far Market rallied 300+ Points, there is not drastic movement in our stocks. We advice purely positional trades and Don't change our Strategy until there are proper proof on chart for the same.

Many are many queries about our patience and why there is no change in the strategy even after market rallied above our resistance 8208. The answer is simple - above 8208 - we have expected a move till 8320 or 8360. That doesn't change the trend, hence we remain with our earlier view only.

This week I have posted some psychological aspect of trading. Of course these are not my own, I need to post here, since i feel this is the right time to do the same.

So what is Patience and Why we need it :-

When the market is moving with high volatile and choppy trades - its usual that many traders loose their patience and force themselves to change their strategy by exiting their current position - and enter fresh trades, usual go into Loss.

Having patience is very essential for a complicated (choppy+volatile) market, in fact patience might actually be the most important factor. And you should keep in mind that trading takes time and market does not moves on your time. As a Trader you should be prepared to wait for a long period of time for a trading opportunity depending on your trading strategy. Many traders fails when they begin to create setup that are not there, thus they are forcing the market.

It usually happens because of their emotional appetite, who often blame market or others, rather than understand the nature or the market.


To become a successful trader, One must be mentally fit ... So this week we give you 20 Golden rules of a Famous Indian Analyst Acharya for your Success..

Rule No 1 : The financial market is a game to make money!It is not a puzzle to solve. The only reason why you should be in the Stock market is to make money. You can be wrong 8 times out of ten and still make money in the markets. So do not be afraid to be wrong. The ONLY GAME and GOAL here is to makemoney.

Rule No 2 : Do not pay attention to fundamentals. Stocks do not follow any fundamentals. For no rhyme or reason, strong stocks and rock solid credentials suddenly lose all their sheen and are untouchables. No one told you in October 2007 that markets were to crash in 3 months, not even in Jan 2008 – Everyone was seeing a rosy picture.

Rule No 3 : Do not blindly believe anyone. Question everything and everyone. Even me. Never blindly believe anything you read or hear about. What anyone is telling or sharing with you is just his opinion., and an opinion is someone's belief – not necessarily fact.

Rule No 4 : Price pattern is all that matters! Trust them. Patterns repeat. See how the pattern repeat and understand firsthand how the markets move. News, rumors and hot tips are useless. Otherwise you would not be getting them free.

Rule No 5 : Patterns have memory! What happened when the last time markets unfolded this pattern. Chances are very high the same action is going to repeat. Patterns repeat. And they are very predictable.

Rule No 6: Stand apart from the crowd at all times. Trade ahead, contrary or even behind the crowd. Try to be the first one in on the trade and the first out with profit in hand. Our job is take their money before they take ours. We should be swift to take advantage of the pattern being presented all the time. Remember the crowd always herds and standing apart from the crowd, always gives us a picture of where they are about to move.

Rule No 7 : Trend is always relative to time.Your job is to make sure the trade fits your clock. Price movement is always up or down and trend is always time specific. A stock or commodity could be in a long term uptrend and a short term downtrend, so take your trade to suit our time frame. Never jump time frames to justify your trade.

Rule No 8 : Avoid the OPEN! The herding tendency is the highest at open, when the whole group is reacting to the overnight news, events or announcements etc. We do not want to join the herd unless it suits our purpose. SO AVOID THE OPEN!

Rule No 9 : Assume the trade is lost even before the trade! The biggest mistakes and blunders of trading occur when you are presented with a textbook pattern, with the WILL NOT FAIL trade, where you over leverage and get wiped out. If you cannot afford to exit at stop loss then you will be out of the game. Always trade within your limits and BE READY to exit at the Stop.

Rule No 10 : If you have to search for the Impulse, it is not there. Impulses are very clear, Near vertical price movements. They just jump out of the chart and create a sense of excitement. If you need to look for the Impulse, chances are it is not there. DONT KEEP LOOKING FOR THEM!

Rule No 11 : If you cannot count it, assume the pattern is a Corrective wave! Barring the Zig Zag, it is almost impossible to count a correction as it unfolds. The only true indication we have is the numerous overlaps. Do not force a count on the correction. The count will become apparent as you reach the end of the correction.

Rule No 12 : Wait till the first pullback/correction after the first impulse for the trade. Never Buy during the correction! Once you see motive waves on both sides of the top/bottom, we know there is a trend change. Wait till the correction ends to trade, since corrections can go on for a long time. You will save precious time than waiting for the correction to end.

Rule No 13 : Manage time efficiently. Time is money in the markets. Do not block your capital waiting for the correction to end. Use time more efficiently for analyzing the markets you are trading

Rule No 14 : Never risk more than 2% of your portfolio on any trade.The first rule of trading is to stay in the game and profitable trades will eventually follow. At random there is a one in a million chance of you making 50 losing trades in a row. Never risk more than 2% of the portfolio in a trade and you will remain in the game to see profits.

Rule No 15 : Never add to a losing position! I do not need to say anything more about this. If you are losing, then accept that you made a mistake and get out of the position while you still can. Averaging a losing position can only make matters worse.

Rule No 16 : Wait for the wave to completely unfold! The highest gains are seen in the third and fifth waves. Wait for the third and fifth wave to complete before thinking of exits. The last 20% of the time gives you over 50% of the gain. Let the waves work to get profits for you.

Rule No 17 : Profit and unease are seen together when you get into a trade.The best trades are seen when you get into the trade at the beginning of the trend. However till the markets move resolutely in your anticipated direction, there is an unease. Learn to live with it. Without mental resolve, it is difficult to win the trading game.

Rule No 18 : Larger trends rarely if ever turn quickly! Investors are a very adamant and stubborn lot and resist change vehemently. Trend changes are slow to develop and wave pattern will tell you much in advance. Be patient and wait till the trend change is clear on the pattern – usually it is clear long before the crowd realizes the trend change.

Rule No 19 :Trading the markets is not everything. It's only money. There are many and more important things in life and you will be better off not forgetting that.

Rule No 20 : All rules are meant to be broken! The skill is when to know which rule to be broken and when to adhere to them.