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First, information on other posts.
I have discussed the concept of Strength and Weakness in a post called ‘Signs of Stength & Weakness’ .
I have also given a brief explaination of My Blogs – Personal Note on My Blogs. This one is just below the current post, you can scroll down and read it.
The Nifty
The trading range was narrow, suggesting some indecision. The Index found support at lower levels bounced back to close at 4360, the top of the day’s range.
As the Index continues to move in a narrow band, there appear to be opportunities for buying on breakouts and selling on breakdown.
The Nifty has two distinct trading zones. The first is a larger range, between 4200 and 4500. A move out of this range will offer a significant trend.
The second range is between 4360 and 4200. This is the range which can easily be broken out from, tomorrow. If this happens, traders should go long, with proper stops.
Inspite of small daily ranges, volatility continues to be at the higher end. Current 10 day historical volatility is 85% of ‘normal’ long term 100 day volatility. I say that this is at the higher end, because a low volatility situation develops when current short term volatility is 50% or less than long term V. Therefore, it is possible that the market may continue to move in a narrow range for a longer period.
The trading idea from this information is to accept that a strong trend may not emerge soon. Trading should be focussed on small profits.
A Personal Note on my Blogs
This blog is my way of saying thanks to all the affection that I have received from traders & investors.
The Dalai Lama says: “Share your knowledge. It’s a way to achieve immortality.”
I wish to share whatever knowledge I have gathered over the years.
This Blog is written to share my ideas, thoughts. I do not wish to make this into a chat session. For this reason, I do not reply to comments, although I read them carefully and really look forward to reading them.
Different Topics on Trading have been put in seperate blogs. There is a Blog List visible to the left of the blog notes. This list contains the names of the Blogs and the latest article for each. As time goes by, it will be easier to keep different topics in different blogs