Monday, 6 February 2012

Traders Psych Post --06feb2012 --SENSEX has broken out of the year long Channel


Hi Friends,

Finally SENSEX has broken out of the year long Channel. Now I would like to revise my Bearish stance on Market and look for Bullish alternatives if any..

Well but as this rally is overstretched I would not jump into buy now. The RSI on most of Indices & Stocks showing negative divergence. So there has to be some sort of correction.

Well this doesn't mean one should take a shot call. All the early shorts(Bears) got fried on every Friday since last month. I always wait for confirmation. Though I have initiated short at 5285 would book loss and move with the Market.

At 5060 I called for early short and got stop out at 5130. And now at 5285 again called for short & will get stop out tomorrow with gap up opening expected.

But after gaining 500-600 points on each swing in NIFTY since last 6 months a 150-200 points loss is a healthy correction. :)

Its a give and take Business. I gave these 200 points to Market & Gained a Valuable Lesson. That an Early Trade without Confirmation would only lead to losses.

So till the time NIFTY doesn't break below the Upward Rising Channel I would not Initiate any short position.

Well since the year long Channel has been now broken upwards I may look for Bullish alternatives. But I'm in no hurry to buy..

As I'm an Elliot follower would simply look at the structure of the fall (i.e. whether a Corrective or an Impulsive) and decide whether to buy on dips.

Till then Stay with the Trend and be Disciplined..


Happy Minting..

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