Trades for 1st June 2009

This week we have 2 scrips to trade.

1. Bharti Airtel: The Weekly chart of this scrip is having stong peak on macd-h along with a peak on Force Index. At the right edge Force Index has given sharp down spike. This indicates indecision. Chances for a sideways move. After a big bullish move, price has retraced to value zone and has held support at 750.00 levels. Both EMA's are rising indicating bullishness. As there is no weakness on macd-h, a re-test to the previous high is likely. Daily chart moved below value on retracement and has closed above EMA. A Green impulse on price bar indicates rising EMA, which favors bullish moves of weekly charts. Force index has retraced a bullish divergence to price lows and has given a stron up spike at the right edge, this coincides with a ranged move for some days. Macd-histogram has gone below zero without any bearish divergence, this indicates, though the bullish sentiment is intact, the next up move is going end it with a reversal. So, exit on this trade needs to have a thorough watch.

Trade long above Friday's high at 836.00 with a stop just below the nearest support at 749.50 for a target of 1020, the nearest resistance on Weekly charts.

We will trade this scrip in our trade account for this week. The Capital we are allowed to risk per trade is 2% of Rs. 1.00 lakh i.e., Rs. 2000.00. Risk per share here is Rs. 86.60, add commision to it at Rs. 12.50. Total risk per share is Rs. 99.10. So, we can take position of 20 shares in this scrip (2000/99.10).

Happy trading.