Weekly Chart for Nifty - What a Year and half!

I love charts. I mean as some one who has been trained as a scientist, I love looking at the same thing from different perspectives to get a comprehensive and deep understanding.

For stock markets and nifty, charts allow me to do the same; and you can look at 5 minute charts, 30 minute charts, EOD charts, weekly charts - each representation gives you a fresh glimpse at what has been the unfolding story and what are the patterns in madness.

So, here is my source of joy this morning. Almost accidentally bumped into the 18 months weekly chart of Nifty ( you can click on it and get a larger view in a new window ).


Fist of all, there is a 2/20 EMA breakout system due to David Landry, according to which two consecutive close above the 20 EMA is a buy signal and two consecutive closes below 20EMA is a sell signal.

Applying it to the chart, you can see that first sell signal came in mid Jan 2008 ( no surprises here !!!). But and here is the good news, even if you missed selling there, you got at least two more selling signals - one in early May another in early September - thanks to the slow stochastic indicating overbought in a strongly down trending market.

So much for the past missed or grabbed opportunities. What about the future? Well, the same Landry system has given a break out in early May. But even if you have missed that one, do not worry. Keep a watch out for the slow stochastic, which by the way has been in the "overbought"
region for many weeks now and that indicates strength. But keep an eye on it. Sooner or later, it will have a dip and be in the oversold region. Since we are in a a strongly up trending market, that may be a great time to get in!!!

So dear reader here I am signing off wishing you a lot of patience and many happy readings of the charts.

P.S. By the way, you can read about the 2-20 EMA breakout system here.

Disclaimer: The above analysis is just that - my analysis. If you choose to trade on the basis of this analysis, you will be solely responsible for the outcome of the trade - profit or loss. Please keep in mind that trading and in particular day trading is not for the novice and there is significant risk of loss of capital in trading.