Friday, October 1, 2010

NH-NL Index..... Will it Deliver???

I'm reading: NH-NL Index..... Will it Deliver???Tweet this! Posted by Trade Less Trade Smart at 6:42:00 PM

4 comments:

  1. alphabet1October 2, 2010 at 7:21 PM

    Colin Twiggs comments

    The Sensex broke resistance at 20000, gapping to 20200 Monday, after a brief retracement. Further advances without a reasonable correction would indicate a self-reinforcing trend: rapid gains but ending in a blow-off and equally rapid reversal. Rising Twiggs Money Flow (13-week) high above zero signals strong buying pressure.

    http://www.incrediblecharts.com/tradingdiary/2010-09-27_markets.php

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  2. PiOctober 2, 2010 at 8:32 PM

    This New High New Low Indicator is pretty much a useless indicator. All of these sort of divergences on technical indicators are pretty much useless in strong trends. Open up the daily chart of Nifty since 2003 and plot a stochastics or RSI indicator. You will notice that they reach overbought/oversold pretty early in a trend and remain there for most of it.

    Infact fact is that the majority of a big move happens after an indicator becomes overbought. Each time those indicators dipped below the overbought line it was time to buy and wait for a new high and time and again it worked. I use the same strategy to trade forex on intraday 5 mins bars. Works beautifully.

    So forget all these indicators, and rather than look to short, wait out patiently for a meaningful decline and then buy and hold for newer highs to come. We will go to 7200 on Nifty (by Jan-Feb) before this move from 5000 is complete. Each 300 point pullback will be a time to buy.

    Cant agree more with your post.

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  3. naresh1711October 3, 2010 at 5:52 PM

    Nifty is in strong uptrend even intraday dips like 5962 is being lapped up for overnight gains. The best of indicators can be misleading in such case. As long as FII are relentless buyers with tons of liquidity provided to them at 0% they will be more than willing to make a killing in our markets along with dual benefit of $ depreciation

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  4. Tryin2TradeOctober 4, 2010 at 5:35 PM

    alpahbet1

    Yup I do read Collin Twiggs!
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    Pi,

    Thanks for ur Inputs...points noted!
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    Naresh

    Boss aaj kal Eid ka chaand ho gaye???
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    Divergence was a view, what is visible on the chart...tradeable or not tradeable is the way how one looks at it...like mentioned many times divergence in itself is not a signal to buy or sell...divergences like many other indicators do fail....but that doesnt render them useless...

    We trade price, and that is the MAntra,in price action,lies the confirmation or non confirmation of the indicator...that's why Patience is the key, before we jump into any trade...sometimes we do get impatient and excited..even in that scenario help is at hand for those who in their throes of ecstasy a irrational exuberance don't forget to put their STOPS!!!
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