Day Trading Guide

May 23, 2011:  

DLF

Fresh long position can be initiated only if DLF climbs above 227 levels with tight stop-loss.

ICICI Bank

Initiate fresh short position if the counter drops below Rs 992 levels with stiff stop-loss.

Infosys

Make use of rallies to sell the stock while maintaining tight stop-loss at Rs 2,852 levels.

L&T

Contrary to our prior view, the stock declined in the last trading session. Initiate fresh long position only if the stock reverses up from Rs 1,600 levels with tight stop-loss.

ONGC

We recommend a sell in the counter with stiff stop-loss at Rs 272 levels.

Reliance Industries

Fresh short position is recommended only if the stock dives below Rs 895 levels with stiff stop-loss.

SBI

Negating our prior view, the stock fell in the last trading session. As long as the stock trades below Rs 2,276, the near-term stance remains negative. Fresh short position can be initiated if the stock reverses down from this level with tight stop-loss.

Tata Motors

The stock declined three per cent accompanied by above average volume, penetrating its 200-day moving average on Monday. We recommend a sell in the stock with fixed stop-loss at Rs 1,145 levels.

Tata Steel

The near-term outlook is bearish for Tata Steel. We recommend a sell in the stock with stiff stop-loss at Rs 567 levels.

Nifty Futures

On Monday, Nifty tumbled 1.8 per cent witnessing selling pressure. Initiate fresh short position if Nifty Futures fails to move beyond 5,424 levels with tight stop-loss.

Keywords: technical analysis

4 Candle Formations Can Be Used With Great Success

Pin: The pin formation is one of our favourites; it shows huge emotion of the market indicating a sign of a reversal. In the case of a bearish pin the bulls pushed the market high but failed to hold it, so price returned back to around the open leaving a pin formation. The pin always points away from where price may be heading.

Engulfing: An engulfing candle is a strong change in momentum in the market often seen from bounces off support/resistance areas. For a buy confirmation the first candle would be red followed by a green candle that
completely engulfs the previous one. For a sell confirmation the first candle would be green followed by a red candle that completely engulfs it.

Railroad Tracks: Railroad Tracks are very similar to engulfing candles except they usually close at the same level as the previous candle (within a few pips) instead of engulfing it. This forms two candle bodies which look like a railroad. We introduced this into our trading in late 2010 after seeing this formation over and over
and noticing its power.

Doji: The Doji is generally a small candle indicating a period of indecision with not much movement, the open and close should be almost at the exact same price but it is acceptable within a pip or two. Out of the 4 formations we find this one the least powerful, we prefer to see 2 or 3 Doji’s in a row before we sit up and consider a trade.

More formulas and strategies are welcome from your side. You can send Metastock, MT4 and Amibroker formulas or trading strategies tostockmaniacs@ymail.com. If we think the formula or the strategy is worth publishing the same will be published here. If possible also send your screenshot of the indicator.

Day Trading Guide YOGANAND D. BL RESEARCH BUREAU

May 22, 2011:  

DLF — Make use of dips to buy the stock with stiff stop-loss at Rs 222 levels.

ICICI Bank— Fresh long position can be initiated if the stock advances above Rs 1060 levels with stiff 

stop-loss.

Infosys— Initiate fresh short position only if the stock dives below Rs 2833 levels with tight stop-loss.

L&T— The near-term stance is bullish for L&T. We recommend a buy in the stock with fixed stop-loss at 

Rs 1630 levels.

ONGC— The near-term outlook is bearish for the counter. Make use of rallies to sell the counter while 

maintaining stiff stop-loss at Rs 280 levels.

Reliance Industries— Initiate fresh short position if the stock fails to move above Rs 933 levels with tight stop-loss.

SBI— We notice formation of bullish inverted hammer candlestick pattern in SBI, which signals near-term trend reversal. We recommend a buy in the stock with stiff stop-loss at Rs 2300.

Tata Motors— Fresh long position can be initiated if Tata Motors reverses up from Rs 1154 levels with fixed stop-loss.

Tata Steel— In the last trading session, the stock climbed 2.7 per cent with above average volumes. Initiate fresh long position if the stock continues to move higher and exceeds Rs 585 levels with stiff stop-loss.

Nifty Futures— Nifty Futures advanced one per cent with average volumes on Friday. Fresh long position can be initiated if Nifty futures surges above 5523 levels with tight stop-loss

Century Textiles & Industries Ltd

NSE:CENTURYTEXView Stock Details

Recommended	Timeframe	Start Price	Target (Gain/Loss)	Stop Loss
above 307.80	3 Months	-	370.00  20.21%	278.00

Return	Risk : Reward	Accuracy	Last Trade	Trailing SL
-	1 : 2.09	-	307.60 (+0.18%)	-

TIPS FOR THE DAY (23.05.11)

SYMBOL	ACTION	RATE	TGT.1	TGT.2	STOP LOSS	REMARKS
LICHSGFIN	Buy	214.60	218.40	222.70	214.05
CHAMBLFERT	Buy	77.30	78.20	79.30	77.15
SKUMARSYNF	Buy	58.55	60.90	63.40	58.40
Note: Don’t wait for Targets. Book partial profits (if profit > 1%) and strictly maintain stop loss.

ADX INDICATOR ( If you follow this Indicator, you will always be in a.

ADX INDICATOR ( If you follow this Indicator, you will always be in a profitable side)

ADX is a trend following system, it consists of three lines;  (i) ADX (blue line), (ii) Up Direction Indicator (green line) (iii) Down Direction Indicator ( red line).

How to Use: 

Please refer to the above NIFTY Chart: The standard interpretation for using the ADX  is to establish a long position whenever the +DI (green line) crosses above the -DI (red line) and for Short Position whenever the -DI (red line) crosses above the +DI (green line).