Tuesday, October 13, 2015

HOW TO USE TURNING POINT LEVELS


The four time frames considered here are Annual, Monthly, Weekly & Daily. The  Resistance levels are named RA, RM, RW & RD and the corresponding Support levels are named as SA, SM, SW & SD. The range given in the table should be considered as a normal trading range for the given time frame.

The market price will have very good momentum on the upside as long as it remains above all the four Resistance levels referred above and conversely, will have very good momentum on the downside as long as the market price remains below all the four support levels mentioned above.

In my experience of using this idea, I have found that it provides resistance/support  at least for once and on many occasion, it becomes top/bottom price which will hold for quite some time.

RA/RM & SA/SM are suited for both – traders/investors, whereas RW/RD & SW/SD are ideally suited for traders.

Resistance and Support levels can also be used as meaningful stop loss levels –  trading the markets without using  stop loss is a first step to financial disaster.

With a view to illustrate how effectively this idea works, I have enclosed a monthly chart of Banknifty Future with lines marked RA level (in Red) and SA level (in Green).  The Second Chart of Nifty Fu (60 min) shows RM & SM levels (in Blue).

I will be sending separate Tweets for the following segments, before the respective markets open:

EQ            - Nifty Future & Bank nifty Future 
MCX         - Gold & Silver
US MKTS - DJIA  & NASDAQ

It will be better to watch the market movement for a few days with the above perspective and I am sure you will realise its effectiveness.

Disclaimer:
The above write up and the daily tweets giving TURNING POINT Levels are given for academic purpose only. However, if you choose to use it for trading/investment  purpose – you will be doing so at your own risk and consequences and the undersigned takes no responsibility for the same.

With Best Wishes,

Ketan  Asher.
13.10.2015

Twitter handle @myturningpoints / Cell 09224636280



NIFTY FUTURE 60 MIN
BANK NIFTY FUTURE MONTHLY

Friday, January 2, 2015

MARKET MATHS


MARKET  MATHS
Market participants always believe the stock markets to be quite random and are always perplexed about its movements.  For a trader, any idea that helps to find swing top/bottom is always welcome.

In a book by W D Gann, titled “How to make profits in Commodities” he has mentioned the following (on page 34):

If we wish to avert failure in speculation, we must deal with causes. Everything in existence is based on exact proportion and perfect relation. There is no chance in nature, because mathematical principles of the highest order are at the foundation of all things. Faraday said: `There is nothing in the Universe but mathematical points of force`.

Every Commodity makes a TOP or BOTTOM on some exact mathematical point in proportion of some previous high or low level.

This article  is an attempt to illustrate, what the legendary trader W D Gann has stated above.

NIFTY FUTURE

NIFTY FUTURE MONTHLY  CHART AS ON 16.12.2014











In the above chart, I have marked the major swing high & low levels on a monthly chart that are relevant for the purpose of this exercise.

The arithmetic works as follows:

                        Nov ’10 High  -  6349   (B)
             Less:   Oct  ’08  Low -  2228   (A)
                                               -----------
                                                  4121
             Add :   Dec ’11 Low      4538  (C)
                                                -----------
                                                  8659 
As against the arithmetical target of 8659, Nifty Future made a  high of 8668 (D). The overrun of just 9 points can well be explained as – what W D Gann referred to as Lost Motion – the effect of momentum that carries prices slightly past its target in a volatile market.

While this idea by itself does not indicate that it is a final  top, but considering that we have used Monthly chart – the significance of this top should not be undermined.

As regards the BSE Sensex, the recent top is not as accurate as in the case of Nifty Future. However, I have given below the levels for comparison purpose.

                        Nov ’10 High  - 21108
             Less:   Oct  ’08  Low -   7697
                                               -----------
                                                 13411
             Add :   Dec ’11 Low    15135 
                                                -----------
                                                 28546 

As against the recent high of   28822.      

In my experience of using this  idea, I have found that it works quite well on stocks/commodities chart of different  time frames.

Keep Learning!

CA Ketan  Asher.
17.12.2014.