Trading Yoga

COMPONENT STRENGTH SCORE 31-OCT-17* Component Strength Score : 55.73 EMA : 52.42 Intepretation : Neutral with Bullish Bias Commentary: Day Stats : Bank Nifty gained 30.8 points to close above 25K at 25019. Day: Up Day Candle pattern: Bearish Candle.  Small upper and long lower shadows.  Range: Narrow Volume:  Low *ABOUT COMPONENT STRENGTH SCORE I am experimenting and developing a Component Strength Score based on the study of the underlying constituents of the Index itself. I have started with Bank Nifty. Here is a WIP version. The graph has three data points The movement of BN itself (absolute points), then there is a Component strength (CSS) raw score overlaid with an EMA of the CSS. How to read the Component strength score (CSS) A score of 50 is neutral A score between 51 and 60 is neutral with bullish bias A score above 60 indicates strength in the rally A score between 40 to 49 is neutral with bearish bias A score below 40 indicates

Big Picture Oct 30th Nifty recorded a 28 points loss to close at 10335.30.  The index opened bearish and continued to remain bearish the entire trading session. There was some buying between 11 AM and 1 PM which took the Index near to the prior day close but selling resumed post 1 PM and finally some short covering towards the close of the market helping the index to recover from 10330 to 10340. Finally it closed at 10335.3. The broad market indices were mixed bag with small caps and midcap gaining during the trading session while the Nifty 50,100 and 200 ending up with losses.  Among the sectors, Realty was a top gainer for a second day in a row while PSU Banks and Metals were top two losers.  Marginal gainers were Bank Nifty, Fin Services, FMCG, Pharma and Private Banks. Marginal losers were Auto, IT and Media. The advance decline ratio was positive at 1.04 while the 52W HiLO Score was 89.60% (versus an EMA of 81.75). This indicates underlying bullish sentiment though many key

Big Picture Oct 30th Nifty recorded a 40 points gain to close at a lifetime high of 10365. The Index created a new peak at  the day's high of 10384.50. The broad market indices were all green with small caps and midcap gaining the most in session today. Among the sectors, Realty and Pharma were top gainers  while FMCG was the biggest loser. IT and Metals also closed marginally in red. The advance decline ratio was positive at 1.91 while the 52W HiLO Score was 89.92% (versus an EMA of 80.47). This indicates wider participation in the rally. Candle Stick Analysis Nifty formed Neutral Candle. The body of the current candle is very narrow and close to the low of the day. Close was above open i.e. Green Candle  Upper Wick was big indicating dominance of supply. Volumes were average. The Nifty reached a new peak with the Day's high of 10384.65 which was higher by around 18 points from the previous day's high (and new peak) The close was close to the

COMPONENT STRENGTH SCORE 30-OCT-17* Component Strength Score : 56.31 EMA : 51.88 Intepretation : Neutral with Bullish Bias Commentary: Day: Up Day Candle pattern: Bullish Candle.  Small upper and lower shadows.  Range: Narrow Volume:  Normal  Conclusion : Bank Nifty gained 149 points to close at 24988. *ABOUT COMPONENT STRENGTH SCORE I am experimenting and developing a Component Strength Score based on the study of the underlying constituents of the Index itself. I have started with Bank Nifty. Here is a WIP version. The graph has three data points The movement of BN itself (absolute points), then there is a Component strength (CSS) raw score overlaid with an EMA of the CSS. How to read the Component strength score (CSS) A score of 50 is neutral A score between 51 and 60 is neutral with bullish bias A score above 60 indicates strength in the rally A score between 40 to 49 is neutral with bearish bias A score below 40 indicates weakness (i.e

Big Picture Oct 27th A failed attempt to close at another life time high. The market opened near the high of the day and traded generally in the green (above prior day close). However, the bears unleashed an evening attack and hammered the Index in the last one hour. Consequently the Index lost 20 points. While the index created a new life time high, the evening attack meant that it failed to create a life high on a closing basis. The broad market indices was neutral to negative as most indices closed in the red. Mid cap 100 closed with zero gains while small cap and next 50 gained. PSU Banks lead the loss making sectoral indices followed by Bank Nifty. Pharma and Media were top two gainers. The advance decline ratio was positive at 1.09 while the HiLo Score was also positive at 84.35% versus a 13 day average of 78.93%. Candle Stick Analysis Daily The daily candle was a bearish piercing candle. The body of the current candle pierced the body of the prior day

INTRODUCTION I am experimenting and developing a Component Strength Score based on the study of the underlying constituents of the Index itself. I have started with Bank Nifty. Here is a WIP version. The graph has three data points The movement of BN itself (absolute points), then there is a Component strength (CSS) raw score overlaid with an EMA of the CSS. How to read the Component strength score (CSS) A score of 50 is neutral A score between 51 and 60 is neutral with bullish bias A score above 60 indicates strength in the rally A score between 40 to 49 is neutral with bearish bias A score below 40 indicates weakness (i.e. selling pressure) CSS crossing over the EMA indicates a change in sentiment. As per data, BN getting into a neutral (from bearish) with a positive bias. How to interpret the EMA This a 13 period moving average of the CSS itself. CSS above EMA with EMA above 50 can be considered strength CSS Below EMA with EMA Score below 50 can be conside

Big Picture Oct 26th A strong show by Bulls on the Expiry Day reaching record highs. Nifty gained 48.45 points to close at 10343.80.   As per the analysis of the options data in my blog yesterday , an expiry above 10250 was anticipated. With supply exhausted, the Bulls were able to push the index to further highs. This augurs well for the Bulls. The broad market indices were all green with midcap and small caps gaining the most in session today. Among the sectors, Metals gained 2.05% to lead the Index to the new high on closing basis. The star performer yesterday i.e. PSU Banks declined on profit booking. IT continued the losing streak while BankNifty ended slightly lower. Pharma recovered. The advance decline ratio was positive at 1.16 while the 52W HiLO Score was 82.65% (versus 77.08% yesterday). The above indicates wider participation in the rally. Candle Stick Analysis Nifty formed a two candle pattern of Bullish Engulfing. The body of the current candle eng

INTRODUCTION I am experimenting and developing a Component Strength Score based on the study of the underlying constituents of the Index itself. I have started with Bank Nifty. Here is a WIP version. The graph has three data points The movement of BN itself (absolute points), then there is a Component strength (CSS) raw score overlaid with an EMA of the CSS. How to read the Component strength score (CSS) A score of 50 is neutral A score between 51 and 60 is neutral with bullish bias A score above 60 indicates strength in the rally A score between 40 to 49 is neutral with bearish bias A score below 40 indicates weakness (i.e. selling pressure) CSS crossing over the EMA indicates a change in sentiment. As per data, BN getting into a neutral (from bearish) with a positive bias. How to interpret the EMA This a 13 period moving average of the CSS itself. CSS above EMA with EMA above 50 can be considered strength CSS Below EMA with EMA Score below 50 can be conside

Big Picture Oct 25th The bulls took full advantage of the news about Recapitalisation of PSU Banks. This sector which was lagging for a while, rocketed with some of the index scrips gaining massively. Consequently the Index rose sharply by ~88 points to close at 10295. Today was again a life time high and a life time high on closing basis. The broad market indices were all green with midcap and small caps gaining the most in session today. PSU Banks led the sectoral indices with a huge 29.63% gain on a single day. Most unusual event one would say, even in the stock markets. Pharma and realty sectors were laggards as they ended in red. The advance decline ratio was 0.79 contrary to the bullish euphoria present in the indices. The 52W HiLO Score was 77% (versus 84% yesterday). Both these indicated stock specific movements and wide participation was missing in the rally today. Candle Stick Analysis Bearish spinning top at the peak indicating a failure by the bulls to con

INTRODUCTION I am experimenting and developing a Component Strength Score based on the study of the underlying constituents of the Index itself. I have started with Bank Nifty. Here is a WIP version. The graph has three data points The movement of BN itself (absolute points), then there is a Component strength (CSS) raw score overlaid with an EMA of the CSS. How to read the Component strength score (CSS) A score of 50 is neutral A score between 51 and 60 is neutral with bullish bias A score above 60 indicates strength in the rally A score between 40 to 49 is neutral with bearish bias A score below 40 indicates weakness (i.e. selling pressure) CSS crossing over the EMA indicates a change in sentiment. As per data, BN getting into a neutral (from bearish) with a positive bias. How to interpret the EMA This a 13 period moving average of the CSS itself. CSS above EMA with EMA above 50 can be considered strength CSS Below EMA with EMA Score below 50 can be conside

Big Picture Oct 24th The Nifty gained ~23 points to close above the psychological 10200 mark at 102070.70. The broad market indices were green except for Nifty Next50. Today the small caps was the top gainer ending 1.18% higher. Among the sectors, PSU Banks gained 3.79% while IT lost 1.03%. Pharma and Auto gave company to IT as the three sectors ended in red today. The advance decline ratio was 1.27 (positive) and the 52W HiLo % was 84.26% (81% yesterday).  Candle Stick Analysis Another neutral day and the suspense continues.  The range of the day was narrower than average. The close was below open creating a bearish spinning top.  The upper and lower wicks and small body with a close at  mid-range level indicates continued balance between demand and supply. The day was an Up Day i.e. The Index traded mostly above the prior day close and it finally closed ~23 points from yesterday's close. The volumes were above average. The bulls have continued to absorb the

INTRODUCTION I am experimenting and developing a Component Strength Score based on the study of the underlying constituents of the Index itself. I have started with Bank Nifty ... Here is a WIP version ... The graph has three data points ... the movement of BN itself (absolute points), then there is a Component strength (CSS) raw score overlaid with an EMA of the CSS. A score above 50 seems to indicate bullishness and a CSS crossing over the EMA indicates a change in sentiment. As per data, BN getting into a neutral (from bearish) with a positive bias. DATA 24-OCT-17 The CSS crossed 50 today supported by PSU Banks in the index. The CSS-EMA cross over also took place today. The EMA is 48.63. Another couple of bullish days could see the bullish momentum return to BN. Currently it is still sideways as per the indicators. Stay Connected : If you wish to participate in a discussion on this blog, please join the Facebook Group  If you wish to learn more about my trai

Big Picture Oct 23rd The market closed 38.30 points higher than the Diwali trading session. The day saw above average volumes with a range of about 100 points indicating high volatility. The close was positive and just 8 points above the open indicating indecisiveness of the market.  The advance decline ratio was 0.89 a bearish sign and HiLo percentage of 81.03% which is a positive sign as this % was below 80s for the last 5 regular trading sessions. All marketwide indices closed in the green with midcaps gaining the most at 0.79%. The sectoral indices presented a mixed bag, with PSU Banks and IT sectors leading the gainers while FMCG and Pharma were top losers.          Candle Stick Analysis A series of spinning tops and doji at the peak indicates a balance of supply and demand and therefore a lack of bullish momentum.  Today's candle has a small body of about 8.2 points and long upper and lower wicks (or shadows).  This is a spinning top (third one from

Candle Stick Analysis Daily Since my last blog two trading sessions took place, including the session on Diwali day. Friday the market was closed. After a good start to the week, the market saw selling pressure on Wednesday as well.  The candle formation was Doji and located below the Tuesday's candle. This is an indication of the bearish pressure on the market. The range for the day gives a clue to the attempts by the buying to push up the market and selling to push down the market during the day.  The fact that the close was very near to the opening (less than 3 points above the open) and in the middle of the day's range indicates neutrality i.e. neither the bear nor the bull sentiment was able to establish itself on the market. Being the weekly bank nifty expiry day, the volumes were higher than normal.  The Diwali session saw a very large bearish candle. Diwali is generally meant for symbolic purchases and the bears utilising this opportunity to push the pri

Big Picture Oct 17th The first couple of hours belonged to the bears as the Nifty moved below yesterday's close. By 10:40 AM, the bulls were able to push the Index into the green. Around noon the bears were back in the game pushing the index down again. Post 2 PM Bulls absorbed the supply and managed to keep the Nifty in the green to finally close just 3.6 points above yesterday's close. The Bulls spread their buying across the market to ensure all the broad based market indices closed in green. The sectoral indices was a mixed bag with Realty being the top gainer and Media the top loser. 6 of the 11 sectors ended in red. The market breadth was at 1.01 indicating neutral sentiment while 52W HiLo Score stood at 78.9% versus 72.12% yesterday. The high of the day and the close for the day were at life time high levels. The new Nifty peak stands at 10252 9 points above 10243. Candle Stick Analysis A spinning top at the peak with normal volumes indicates the fierce bat

Big Picture Oct 16th  Another strong show by the bulls as Nifty opened above the previous high and traded through the day above Friday's close. It gained 63.40 points to close at 10230.85. The market breadth was negative with an advance to decline score of 0.88. The 52w HiLo score stood at 72% down from 79% on Friday. The broad market indices all closed in the green with midcaps gaining the most at 0.73%. Amongst the sectoral indices, Metals and Pharma lead the gains while Fin Services and PSU banks closed in the red indicating weakening sentiment for the finance stocks. All the new highs and bullish closes will continue to be life time highs for the Index. Accordingly the close of 10231 is a record closing and the high of the day 10242.95 is a record high, now a decent 64 points above the high in Sept.  Candle Stick Analysis Today's candle has a very interesting formation. A small upper wick and a small body with a significant lower wick 50% of the day's range

Big Picture Oct 13th Nifty made a new life time high of 10191.9 and with a gain of 71 points, Nifty closed at 10167.45, also a life time high closing. Double dhamaka on the last day of the week.  Nifty opened gap up and continued to trade above the open through out the day. The volumes were above average. There were some contra indicators in terms of the market breadth and sentiment. The advance decline ratio was 0.84 (1 is neutral, less than 1 means more declines than advances and greater than 1 means more advances than decline). The 52WHiLo was at 79% . Amongst the broad market indices, mid cap closed in red while the rest closed in green. Among the sectoral indices three indices closed in red ... Media, Pharma and FMCG while the rest closed in green, including PSU Banks which has been a drag in the recent past. While there has been mixed signals, the overall mood continues to be buoyant. Candle Stick Analysis Daily A gap up bullish candle closing at lifetime high