Category: STOCK MARKETS

PRICE TIME and FACTS for MARKETS ahead

MARKETS are moving strong following the strong trend since the start of this month. In past week I cleared my stand regarding the setup which looks stretched to me but markets can stay overstretched for long time on the base of price. As a Trading Participant we also have to understand the factors which are behind the rally whether it’s on upside or downside. Sir Gann writes in detail on this Topic in his book TRUTH OF THE STOCK TAPE which he wrote in 1923 this is the must reed book for all his followers.

Continuing the analysis engaging the heavy volumes the factor I pointed previously as well. According to the rule of trend reversal in current context the volumes of the day on which markets falls has to exceed the volumes of the days when markets goes up. This has not happened since last 34 trading sessions even when market fell in the end of October the volume factor wasn’t supporting the downside. So this has to be considered while analyzing trend after considering the Price and Time Calculation.

Coming to the topic of Price and Time. For a change let’s start with Time first. The Time factor has been very bullish throughout this rally along with the Price Factor. And that’s obvious because for any trend to sustain we need both price and time on the same direction. But the real test for market on Time front would happen in the second week of December when multiple Time cycles would end and it would cause the Voletility in our markets as well as the markets around the world as well. Along with the second week of December we would have minor and major Time cycle dates which would be on the 1st of December 17th of December 24th of December and 28th of December 2020.

Now moving to the price level to watch for NIFTY and NIFTY BANK would be 12700 and 28500 on spot respectively. Earlier also I suggested 12700 as a major support for NIFTY which was held for the rest of the week. Even during the dipp we got on previous wednesday the level of 12700 was held and NIFTY gave a bounce holding it. For this week also 12700 remains the key support the short term setup remains buy on dipps as long as 12700 and 28500 continue to hold on both the Indices. Not only Price these levels are important according to time as well. Until the second week of December atleast important level on upside would be 13135 and 13315 note 13315 to 13365 is very important zone to watch on upside. For NIFTY BANK 30500 and 31500 are cycle levels NIFTY BANK yet has not crossed its January highs.

When I post directional or positional levels my friends doesn’t always understand that swing targets are based on cycle of that particular stock or index they are not necessarily a level to enter trade at any point. Trading in short term is generally done using Gann angles. But the levels which I post are based on cycles not angles. So it would be tough for anyone who do not have the basic knowledge of Gann. While using cycles in positional trading there is a process which has to be followed to enter average and exit the trade. To understand it you have to invest your time in learning and researching on the subject. You need to work for 12 to 16 hours everyday. It’s not as easy as you log in your account and exit in profits in the end of the day. Stop trading if you thinks this way.

2020 so far has been an eventful year for Financial markets. And all participants who are observing market for several years. In last 6 months the community of Analysts Investor’s and Traders has increased sharply. Main reason behind it is the spectacular rally in the markets referring which the people are thinking to make money easily without obtaining the basic knowledge of market functionality and its Technicality without a basic knowledge it wont be easy for them to survive in markets beyond a certain point. Sadly people like these could be the victim of next market selloff. To survive in markets optimistic or pessimistic approach wont help you need to have a practical approach to deal successfully with consistency. You may have good and bad times as Analyst or Trader but it doesn’t make you a bad market participant as long as you follow a particular process based on which you make your own view. If your process or system puts you on a correct path 90 out of 100 times on an average then just keep following that process without a worry. There are rare theories which provides such stability to traders. Gann Theories is one of them. .

NIFTY Update

NIFTY today has tested the important resistance zone of 12950 to 12970 on spot. Also we have a Gann date today so todays low becomes very critical on closing basis for the strong trend to continue. As I suggested to have a bearish view below 12600 for conservative traders in my post of previous week that level now has moved up to 12700 on spot. I earlier also posted my concerns regarding the length of this cycle which has completed its course. Still those concerns remains. But the markets had enjoyed heavy volumes since last 3 weeks. And that’s the only factor which is favourable soon volumes would also decrease gradually possibly till next week.. so we would find it tough to sustain higher. Personally not intrested on long side even we test 13100 or 13250 would look to enter longs above next monthly breakout angle of 13300 for another 7% rally from there. Till then would remain stock specific.