Use of Various Technical indicators. (Educational Post)
Nifty again after making a new high ended in negative today. Main reason for nifty ending in negative can be attributed to channel top resistance. RSI (Relative strength Index) reached over heated zone and peaked above 80 showing the market was overheated, this was the second reason of Nifty ended in red of Friday after a fantastic weak. RSI of monthly and weekly and daily candles also shows that Nifty is in the overbought zone. This can continue for a while or Nifty can dive next week or in the coming time searching for it's supports for the purpose of correction or consolidation. On hourly chart as seen above RSI Peak is near 81 with supports near 57 and 47 range. Currently the RSI is at 64.67.
Bollinger Band is also suggesting temporary market peak near 26336 and strong support near 26092 and 25866.
MACD is also signaling towards consolidation and correction as the coveted blue line seen in the chart is dipping below red line. Histograms sine wave is going towards negative zone with some strength in it's stride.
50 hours EMA or the mother line is near 25909 and 200 hours EMA or the father line is near 25345.
Parallel channel indicates top near 26336. Mid channel support near 25866 and channel bottom support is near 25595.
Trend line support is near 26148 and trend top seems to be near 26437.
Supports and resistances drawn based on recent peaks and valleys are as under:
Supports at: 26148, 26037, 25866 and 25595.
Resistances at: 26277 (All time high resistance)
In the above chart and data we have used the combination of Supports and Resistances, Trend lines, EMA, MACD, RSI, Parallel Channel, Bollinger Bands. You must have seen that various Technical indicators many a times indicate same or similar levels. Thus instead of trying to master many indicators, if you can focus on a few and master them, you will be more often correct. As Bruce Lee has famously said and I quote him, "I am not afraid of someone who knows 10000 kicks, I am afraid of the one who has practised 1 kick 10,000 times."
It is also said in Sanskrit 'Sarva Deva Namaskaram, Keshavam Prati gacchati'. Pray to any of the divine forces but they ultimately end up at the feet of the supreme God head. Nasiruddin Shah had also said in a movie (Kabhi Haan Kabhi Na) "Idhar se jao, udhar se jao, ultimately sab rasta God ke pass jata hai." Deducing from it many indicators often yield same results. Master 2 or 3 of them and they will make you a great analyst.
Conclusion: Learn, unlearn, relearn and master a few indicators rather than trying to know many indicators. They will help you create generational wealth. To know more about these indicators and how to use them and to understand Techno-Funda investment, read my book: The Happy Candles Way to Wealth creation available on Amazon in Paperback or Kindle version.
The information regarding Nifty in this article is for the purpose of education and to show how various indicators often give same or similar result.
To know more about when to book profit? Where to place a stop loss or what is trailing stop loss you are recommended to read my book: The Happy Candles Way to Wealth creation which is available on Amazon in paperback or kindle version. You can also comment below or send a message to us.
Disclaimer:
The above information is provided for educational purpose, analysis and paper trading only. Please don't treat this as a buy or sell recommendation for the stock. We do not guarantee any success in highly volatile market or otherwise. Stock market investment is subject to market risks which include global and regional risks. We will not be responsible for any Profit or loss that may occur due to any financial decision taken based on any data provided in this message.
Bollinger Band is also suggesting temporary market peak near 26336 and strong support near 26092 and 25866.
MACD is also signaling towards consolidation and correction as the coveted blue line seen in the chart is dipping below red line. Histograms sine wave is going towards negative zone with some strength in it's stride.
50 hours EMA or the mother line is near 25909 and 200 hours EMA or the father line is near 25345.
Parallel channel indicates top near 26336. Mid channel support near 25866 and channel bottom support is near 25595.
Trend line support is near 26148 and trend top seems to be near 26437.
Supports and resistances drawn based on recent peaks and valleys are as under:
Supports at: 26148, 26037, 25866 and 25595.
Resistances at: 26277 (All time high resistance)
In the above chart and data we have used the combination of Supports and Resistances, Trend lines, EMA, MACD, RSI, Parallel Channel, Bollinger Bands. You must have seen that various Technical indicators many a times indicate same or similar levels. Thus instead of trying to master many indicators, if you can focus on a few and master them, you will be more often correct. As Bruce Lee has famously said and I quote him, "I am not afraid of someone who knows 10000 kicks, I am afraid of the one who has practised 1 kick 10,000 times."
It is also said in Sanskrit 'Sarva Deva Namaskaram, Keshavam Prati gacchati'. Pray to any of the divine forces but they ultimately end up at the feet of the supreme God head. Nasiruddin Shah had also said in a movie (Kabhi Haan Kabhi Na) "Idhar se jao, udhar se jao, ultimately sab rasta God ke pass jata hai." Deducing from it many indicators often yield same results. Master 2 or 3 of them and they will make you a great analyst.
Conclusion: Learn, unlearn, relearn and master a few indicators rather than trying to know many indicators. They will help you create generational wealth. To know more about these indicators and how to use them and to understand Techno-Funda investment, read my book: The Happy Candles Way to Wealth creation available on Amazon in Paperback or Kindle version.
The information regarding Nifty in this article is for the purpose of education and to show how various indicators often give same or similar result.
To know more about when to book profit? Where to place a stop loss or what is trailing stop loss you are recommended to read my book: The Happy Candles Way to Wealth creation which is available on Amazon in paperback or kindle version. You can also comment below or send a message to us.
Disclaimer:
The above information is provided for educational purpose, analysis and paper trading only. Please don't treat this as a buy or sell recommendation for the stock. We do not guarantee any success in highly volatile market or otherwise. Stock market investment is subject to market risks which include global and regional risks. We will not be responsible for any Profit or loss that may occur due to any financial decision taken based on any data provided in this message.
Happy Candles Investment
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