Sunday, August 28, 2011

Will Monday see a gap up?

Two different news items could influence our markets on Monday morning. First, the prospect of QE3 in the USA which sent U.S, equities and Gold higher on Friday. Second, an apparent resolution of Anna's fast, which can reduce political heat, at least for some time. Both news items should be positive for the markets. Together with the news is sustained selling in the Indian markets and it is quite possible that sellers may now pause and wait for a few days.

Short term traders should manage their trades, have a plan for gaps against their position, as well as gaps in favor. If a trader does not have a position, then what will be the approach towards trading for the day? While going long above the first 15 minute high is a setup, we should remember that the short term trend is down, therefore, any buy signal should be mainly for intraday. Intermediate position traders are likely to be short with stops that should not be affected by Monday's rally.

5 comments:

sudhin said...

Under the next step you have used 55sma as your basic moving average for your bull and bear set up, why 55? is it because it is a fibonacci no. or this gave your the minimum whipsaws? Could you add 5highema which could given an early indication but off course there will be some whipsaws? Thanks for your valuable inputs.

sudhin said...

Could you please suggest some stocks which we could keep an eye on in the decline for a 2-3 year time period. Secondly is it true that the GOI is not going to increase the gas price from KG6 basin and hence RIL is tanking? I got an alert on the same via email, so do the technical charts show a level of <650?

Bhavin said...

Sir can u plz help me know from where i can learn serious technical analysis i am from Surat Gujarat.Sir plz guide me i want to do trading for leaving my email is bhavinbvashi@yahoo.co.in

Sir plz guide

RS said...

Sir, Great call. Have 2 queries
a) How to trade the White Marubozu (well almost) in this scenario and in your trading experience, what's the high probability setup following the same

b) Sometime back u had sugegsted Street Smarts and Marc Rivalland's book. Could you please tell a few more good books on Swing trades with strategies et al.

Regards
RS

amarjeet said...

respected sir,
please explain about honda motor corp.because i am confused because volume & rsi indicator show weakness.