ABC Correction

Lets take a look at the hourly charts over here....Its pretty much defined with the trendlines, a possible wedge setup...Or maybe just a channel which also says we have to bounce UP from here. IF this is a normal correction, we have completed A, B and C got over yesterday suggesting we bounce today to the upper level of the range which comes to around 5040 which was the target I was looking for when I took my longs....Still seems reasonable to expect this short term. Medium term 5050 is important - Needs to trade above to confirm correction is over.

Else we will see lower levels from somewhere down from the 5000/5040 area.

Trade safe. I will post updates to positions if any during the course of today.

Best.

Market Update - May29th 2008

Hello Friends,
I am back from vacation playing on all the slot machines in Las Vegas....Had a fun time...Was tough for me to even trade let alone post updates here...But will try to post more regularly from now on...Daily chart below.

Earlier I posted I was looking for a bounce...We got the bounce but it was a weak one that was quickly sold...What is worrying to me now is the huge figures FIIs are selling off nowadays...Not sure what is going on but situation looks quite dicey. I think we might be setting up for a big drop but this drop might not go below earlier lows of 4400 area. However we will see that when we get there...

Right now I am still long...I am looking to exit this on any bounce I get...I am not sure what yesterdays action was...It was quite scary to say the least....I am wondering if this was the usual expiry shenanigans or something more serious? No easy answer but next couple of trading sessions should tell us.

4800 is of utmost important. Break this, and a mini-crash is even possible.

Trade Safe. If you are not sure, stay out.

4920 on upside is strong resistance. Above this, 4950 area.

If we sustain above 5050 for sometime, I will say that correction is over as the falling channel would have broken to the upside....If not, lows await us.

I am looking to close longs soon and get flat...Or build some shorts...However I am not confident of this market so best thing might be to just stay out for some time.

I apologize if I sound bearish but situation is not clear at this point. I will wait for 2 more days before sounding more confident in either direction...I have indicators showing conflicting viewpoints..Better stay out when not sure.

Bottomline is that 4800 area should hold for the bullish case to remain alive - Short Term.

Best.

Quick Update - May 27th

Hello Friends,
Quick Update...Dont have time to post charts but I think we are setting up for a small bounce upward...Atleast a small bounce...We will reevaluate later....For now I think 5040-5100 area we will get sometime next week...Rolling over longs to June and adding some more to the very small position I had before..Please note market still very weak but ALSO very oversold...To expect a bounce is reasonable...But this is a risky play...I am hedged with puts.

4800 area should hold - Very Important!

CURRENT POSN: LONG NF 4831. (My avg price for June - I have a loss of around 40 pts for May..Just for the record)

Best.