Did you Buy at 2975 ?

In an earlier post, I suggested that aggressive traders should buy if the Nifty were to close above 2975. This was not a magic number. It was the mid point of the trading range. If the Nifty is closing abover the mid point then we get the first indication of a push to resistance. This seems to have happened.

My question is: If you considered to be an aggressive trader, did you buy ? Chances are you read it, thought about it but did not take any action.

Now, we are at a point of high risk. There is significant resistance around 3160. The Nifty has retreated back four times from this zone. Even if the Index manages to cross this zone, we can expect a correction to come in. Therefore, this is no longer a good time to buy. You should wait for a dip, however frustrating it may be (the waiting!).

I have a comment asking me to write about Gold. The yellow metal is in an uptrend, making higher highs and higher lows. At some point, there will be a correction in the up move. When ? Gold faces resistance between 13800 and 14000. But what if the US Dollar continues to strengthen raising the price of gold in India ? What if Gold itself moves up further breaking through resistance ? It is possible that the trader maye xit at the ‘point of maximum pain’ and prices start falling immediately after. When you are on the wrong side of a trend, the decisions are no longer about technical analysis, they are different, about managing risk and your capital. There are no easy decisions.