Just Trade Nifty 24 Nov

Above 4693 target 4709-25-55-76
Below 4677 target 4662-38-4600

Weekly Just Trade Nifty 21 to 25 Nov UPDATE

We had gone short at 4843 on Monday and booked partially.

Today just now booked fully as target achieved at 4740

The levels posted for this week was

Below 4843/20  target 4740

CLICK HERE TO READ THE FULL POST

Inside Days with Bollinger Bands-23 Nov

Combining Inside Days with Bollinger Bands

Prices at the upper Bollinger Bands are considered high and prices at the lower Bollinger band are considered low. However, just because prices have hit the upper Bollinger does not necessarily mean that it is a good time to sell. Strong trends will 'ride' these bands and wipe out any trader attempting to buy the 'low' prices in a downtrend or sell the 'high' prices in an uptrend. Therefore, just buying at the lower band and selling at the upper band is out of the question. By definition, price makes new highs in an uptrend and new lows in a downtrend, which means that they will naturally be hitting the bands. With this information in mind, our filter will require that buy signals occur only if the candle following the one that hits the Bollinger band does not make a new high or low. This type of candle is commonly known as an inside day. The best time frames to look for the inside days are daily charts, but this strategy can also be used on hourly, weekly and monthly charts. Combining inside days with Bollinger bands increases the likelihood that we are only picking a top or bottom after prices have hit extreme levels. As a rule of thumb, the longer the time frame, the rarer the trade will be, but the signal will also be more significant.

Today we have a copy book set up of an Inside Day with Bollinger Bands.

Two ways of trading this set up.

1. Go long stop to be placed 10 points below yesterdays low of 4765. First target 5133.

2. Wait for a breakout above 4875 and go long. Stop for this is ideally the low of previous candle which is 4765. Unfortunately the stop is 100 points hence this set up does not have a good risk reward.

Will Go long tomorrow following the first set up.

Just Trade Nifty Future 23 Nov

Nifty Future Chart.
Levels posted in this post are future levels.

Above 4790-93 target 4819-35
Cluster resistances at 4819-35
Above 4835 target 4870-4905
Below 4770 target 4720-4690

Just Trade Nifty 23 Nov 2011

Above 4800 target 4824 -4844
Cluster Resistance at 4824-44
Above 4844 target 4867-4914
Below 4790 target 4762
Below 4762 target 4720 and 4690

Post Trading Analysis and Result-22 Nov

Sold Nifty as per plan and levels posted at 4820 and booked at 4885

Sold Nifty again at 4845 and booked at 4790

Total Profit 90 points in two trades.

Just Trade Nifty 22 Nov UPDATE

Sold Nifty as per plan and levels posted at 4820 and booked at 4885

Will go long above 4777 stop 4764

Nifty in trading range.

Weekly Just Trade Nifty 21 to 25 Nov 2011 -UPDATE

As per levels posted went short below 4843 for target of 4740.
Booked partial profit today at 4770. Profti so far 73 points.

CLICK TO READ POST

Post Market Review and Result of Trading

Todays Levels Posted was
Above 4888 target 4909
Above 4909 target 4932-4941-4953
Above 4953 target 4997
Cluster Resistances at 4941 to 4953
Below 4874/61 target 4845-40 and 4826

Today Nifty opened at 4871, high was the same and traded lower.
Our level to short was below 4874. Nifty gave 100 points from our sell level.

Just Trade 22 Nov 2011

Above 4777 target 4820-45
Sell around 4820-45 stop 4855
Below 4764 target 4726-4709
Below 4709 target 4650-4600

Nifty Future for 21 Nov 2011

Posting Nifty Future Charts and Levels for Trading.
Levels in this post are future levels

Above 4882 target 4918
Above 4918 target 4930-41-65 &5016
Below 4870 target 4849- 41
Trading Zone 4882 to 4918
Breakout Above 4918
Breakdown Below 4870

Just Trade Nifty 21 Nov 2011

Above 4888 target 4909
Above 4909 target 4932-4941-4953
Above 4953 target 4997
Cluster Resistances at 4941 to 4953
Below 4874/61 target 4845-40 and 4826

Weekly Just Trade Nifty 21 to 25 Nov 2011

Looking at the three different charts out of which two are weekly and one daily, we can deduce the following for positional trading next week:

Above 4888 target 4951
Above 4951 target 4991 and 5016
Above 5016 target 5103,5142 and 5160
Below 4843/20  target 4740

Breakout Above 4951
Breakdown Below 4820
Trading Zone 4843- 4951

Weekly Channel Just Trade Nifty 14th Nov to 18th Nov 2011-UPDATE

We had gone short below 5132 and booked partially at first target at 5039.
Today second and final target was achieved at 4848. Total profit from this trade 284 points.

CLICK HERE TO READ THE POST

Just Trade Nifty 18 Nov 2011

Above 4957 target 5002 and 5010
Below 4929 target 4900 and 4850
Final support for this fall is at 4822-20.
Chances of Nifty bouncing from this support is there as all indictors in all time frames is highly oversold.

Behavioral Finance

Reality in the financial world of stock markets is that 90 to 95 percent of the people/traders lose money.  Why then do we still have such a large number of people who continue to be in this market either as investors or traders and this number is growing day by day even though they fall into the 90 to 95 percent bracket.

Will Behaviorial Finance help us get out of the 90 to 95 percent bracket....

What Does Behavioral Finance Mean?

A field of finance that proposes psychology-based theories to explain stock market anomalies. Within behavioral finance, it is assumed that the information structure and the characteristics of market participants systematically influence individuals' investment decisions as well as market outcomes.

It's hard not to think of the stock market as a person: it has moods that can turn from irritable to euphoric; it can also react hastily one day and make amends the next. But can psychology really help us understand financial markets? Does it provide us with hands-on stock picking strategies? Behavioral Finance theorists suggest that it can.

Behavioral Finance: Introduction

According to conventional financial theory, the world and its participants are, for the most part, rational "wealth maximizers". However, there are many instances where emotion and psychology influence our decisions, causing us to behave in unpredictable or irrational ways. 

 Behavioral Finance is a relatively new field that seeks to combine behavioral and cognitive psychological theory with conventional economics and finance to provide explanations for why people make irrational financial decisions.

Why is behavioral finance necessary?

When using the labels "conventional" or "modern" to describe finance, we are talking about the type of finance that is based on rational and logical theories. These theories assume that people, for the most part, behave rationally and predictably.

For a while, theoretical and empirical evidence suggested that CAPM (capital assest pricing model), EMH( Efficient Market hypothesis) and other rational financial theories did a respectable job of predicting and explaining certain events. However, as time went on, academics in both finance and economics started to find anomalies and behaviors that couldn't be explained by theories available at the time. While these theories could explain certain "idealized" events, the real world proved to be a very messy place in which market participants often behaved very unpredictably.

One of the most rudimentary assumptions that conventional economics and finance makes is that people are rational "wealth maximizers" who seek to increase their own well-being. According to conventional economics, emotions and other extraneous factors do not influence people when it comes to making economic choices.

In most cases, however, this assumption doesn't reflect how people behave in the real world. The fact is people frequently behave irrationally. Consider how many people purchase lottery tickets in the hope of hitting the big jackpot. From a purely logical standpoint, it does not make sense to buy a lottery ticket when the odds of winning are overwhelming against the ticket holder.

These anomalies prompted academics to look to cognitive psychology to account for the irrational and illogical behaviors that modern finance had failed to explain. Behavioral finance seeks to explain our actions, whereas modern finance seeks to explain the actions of the "economic man" (Homo economicus).

To Be Continued....

Just Trade Nifty 17 Nov 2011

Above 5049 target 5064-5083-5099-5120
Below 5045target 5015-5005-4994-4947

Just Trade Nifty 16 Nov 2011

Above 5064 target 5110
Below 5053 target 5028-5020
Cluster support at 5020
Below 5020 target 4820

Weekly Channel Just Trade Nifty 14th Nov to 18th Nov 2011 -UPDATE

As per weekly channel chart posted short at 5132 is nearing our target of 5039. Todays low of Nifty 5053.80 and close is at 5054.45. Profit of 77 points.
CLICK HERE TO READ THE POST

Just Trade Nifty 15th Nov 2011

Above 5185  buy
Below 5135 sell
Cluster Resistance at 5161 to 5185