Tuesday, April 15

Nifty Technical Analysis for 16 April

FII_1
  • FII's sold 30696 contract of Index Futures worth 1028 cores (17.5 K longs were squared off and 13.1 k shorts were added for  Index Future) with net OI decreasing by 4.4 K contracts. So today's FII's have started entering shorts in Index Futures.
Nifty finally broke its up trending channel and closed below it,Nifty is now trading at crucial juncture and any break below 6650 will end the current uptrend. On going correction is good for market as it will shake off weak hands and market can

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Monday, April 14

Nifty Weekly Technical Analysis

Last Week we gave Chopad level of 6711, Nifty did 1 target on Downside and 2 on upside. Next week  being a Holiday Shortened week, will start with Infosys result and WPI inflation data for March 2014 at 12 noon on 15 April and CPI inflation data for March 2014 also on 15 April at 17:00 IST. Lets analyze how to trade Nifty for next 3 trading sessions.

Nifty Hourly Chart

nifty hourly
Nifty Hourly charts has closed above its 50 HDMA, which is bullish in short term.Any close above 6820 will bring back bullishness in market.Breaking 6640 will only bring bears in market.

Nifty Daily Chart

nifty daily

On daily charts, nifty is trading near its up
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All you want to know about India VIX Futures

Volatility is known as a measure of change. A higher value of volatility indicates that prices can change at a faster pace (either going up or down) as compared to the immediate past.
Traders are often looking for new strategies to trade a major event, say a Election Results or Union budget or credit policy or even important results like Infosys. Normally a trader would have bought, what an option trader calls a Long Straddle strategy. In entering this strategy, he would buy a long call and a long put option of the same strike price and same expiry.
In order to earn profits from such a strategy, markets need to move sharply in either direction such that profit from one direction would be more than the loss from the other one. However, the strong following of such a strategy leaves very little on the table (if at all) as prices of both the call and put option rise before the event as they all fear the extreme.
Traders will now have an instrument to earn from such an eventuality. NSE recently launched India Vix Futures for  traders who are willing to bet on volatility. India VIXis a volatility index based on prices of Nifty options.
Before you start trading the India VIX futures contract, here are few points to consider 


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Saturday, April 12

VIX shows market betting on 600-pt Nifty swing on May 16

The India Volatility Index (VIX) has gained 28 percent in the last four sessions. Normally, this would have meant the market had declined during this period. That is because the movements in VIX and the market are inversely co-related, more often than not. But this time around, the Nifty has risen alongside VIX, gaining 3 percent in the last four sessions.

So what’s happening here?

The most obvious explanation is the fact that the market is looking at May 16 Lok Sabha election results as a binary event –  Narendra Modi coming to power thumbing Victory which can move the Nifty by 600 points or more. And traders are either taking guard, or trying to ride the swing with minimum risk.

The biggest example of this was the rise in

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Friday, April 11

Difference between Trader and Gambler

The vast majority of traders are gamblers, maybe the majority of market participants are in fact gamblers. The traders that are gamblers trade with no plan and without understanding the odds are stacked against them. Whether it is buying far out of the money options with no method for profitability or randomly chasing stocks on a whim, gambling is when you risk money with the odds against you and have no edge. The losses of the gamblers is where the majority of the profits come from to the winning traders in the markets who have an edge.
Now the other side is the traders that consistently win by using an edge that gives them an advantage over the other traders. The winning traders are not trading against the casino they are trading against the gamblers. They have become the casino, like the casino they know the odds are in their favor and they will be profitable in the long run. Like the casino has table limits they have risk management to not over expose themselves to any one bet by
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