There is a peculiar pattern formed this week with the different timeframes in NIFTY chart. Weekly chart has pulled up from weakness and shows signs to a continuation of bullish trend. Daily charts are neutral while the Hourly chart is bearish. This makes the alarm ring loud, "The Markets at present is not a sweet game, be watchful", to support this we find drifting volumes every day. A clear indication that the smart money has gone out on a fishing expedition.
Those who are fighting it out here on the volatile arena are the averages who want to grab of some left over. While we found this pattern, we took a different study to find how the stocks are stacking themselves in the trendiness. There we got a better confirmation.
On the Weekly charts, 21 stocks are on the bullish trend, 12 stocks in the bear trend and 17 stocks on the sideways. This shows that the weekly trend is bullish or at the most to continue with bullishness for some more time.
On the Daily charts, 18 stocks are bullish, 5 stocks are bearish while a major chunk of 27 stocks are neutral. This coincides with the sideways pattern that the index is now. Stock list which we used for this is the NIFTY Index stocks.
We started giving the intraday calls of our system from Friday last. Our first trade though was a Whipsaw losing 30 points while the next short trade is reaping it rich by being positive by more than 80 points at the time of market close. The weakness is likely to continue further. Hold to short position till we give the exit call. If the market is in trend on the Hourly charts, there will likely be a reversal trade on exit.
We do not predict to have a 80% or 90% winning trading system, this is a probability game. There can be a losing stretch running of more than 7 trades too, and vice versa, but trading with discipline we can surely reap rich rewards. We will continue to post our calls as it happens to come. There is no bias, just following a simple trading system.
The Sector performance for the week is again a different picture with most of the sectors closing in green. The exceptions were ENERGY and BASIC MATERIALS Sectors which have closed weaker just short of a percent. While TELECOM Sector gave back close to 3%, the weakness of this sector was strewn all over its Index with all the stocks in this list, BHARTI, IDEA, RCOM, MTNL & TATACOM etc., most of them have given new lows.
The bearish trend in the TELECOM Sector is likely to continue further. On the winning side it was CONSUMER SERVICES & FINANCIAL Sectors that have closed positive by more than 2%. All the Industry groups in the CONSUMER SERVICES Sector have given robust gains with Hotels leading the pack by more than 6% gains followed by DIAMOND Industry gaining close to 5%.
In the FINANCIAL Sector it was the super strong performance of Term lending and Equity Investment Industry with more than 6% gains followed by Private Banks Industry which has closed with an above 5% gains that has pulled the Sector strongly up.
The strongest Industry groups in trend this week are Diamond, Leasing & Hire Purchase, Pesticides and agrochemicals, Paper & Leather Products Industry groups.
Many of our weekly calls of the past week were not filled, of that some got a new entry and many are off the signal. The list for this week is as follows.
Short Trades
SAIL, below 207.10 stop 222.50.
AMBUJACEM, below 104.55 stop 121.50.
BHEL, below 2351 stop 2413.
CIPLA, below 309.80 stop 330.
HINDUNILVR, below 231.35 stop 258.
JINDALSTL, below 648 stop 687.50.
Hold stop for TATASTEEL which was filled short on Friday.
Happy trading.
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