OPTO CIRCUITS AS ON 23.08.2012

comments on chart

BUY LT FOODS ( DAAWAT ) CMP 48

DAAWAT has given a good break out today post good results.

cmp 48

buy with sl  below 45 on closing basis

target 55

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update :

target of 55 achieved on 25.09.2012

cheers !

update  : 4/10/2012

DAWAT 60......

NEVER BUY A FALLING STOCK

Never average down. When a stock falls significantly below your purchase price, it is foolish to buy more. The stock is clearly not behaving the way you anticipated. Strangely enough, many investors will sell a winning position to lock in a profit because they are afraid the stock will decline and that profit will evaporate. Instead of selling, they should let the stock run as long as it "wants" to and sell only if they get a sell signal. 

They will not sell a stock that has declined because that would lock in the loss. People do not like to admit that they were wrong about a choice once they have made it. Therefore, rather than conclude that they made a bad choice, they convince themselves that the choice was right and that since the stock has declined it is a better deal now than it was originally. In a state of denial, they buy more of the stock that declined. 

If the investor bought right at the line of support, the stock should have risen rather than decline. Expert traders often buy at a line of support because that helps them minimize risk. If the stock falls to a close only 3% below that line of support, the experienced trader knows something is wrong and can sell with minimal loss. However, the amateur denies he made a mistake and buys more. If the stock declines, that is certainly not a buy signal, it is a sell signal. The stock was bought on a certain premise. If that premise proves to be wrong, there is no longer a valid reason for maintaining the position.

If you get a margin call, you have obviously been in the stock too long. A margin call occurs when the stock has had a significant decline. If your reasoning was sound when you purchased, that should not happen. Never meet a margin call. Why throw good money after bad? Save your cash for something that looks more promising rather than put it into something that has already started to fail. 

It is far better to buy more as a stock rises (average up), because it is behaving the way you anticipated. In other words, average up rather than average down. The fact that a stock is moving in the right direction after its purchase is evidence that the thinking behind that purchase was sound. It is an indication that the right decision was made. A stock that has already started to rise above its support, presents far less risk than a stock that already started to decline below its support. 

SOURCE : VFMDIRECT.COM

NIFTY IN A TRAINGLE

Nifty is consolidating in a triangle.

prev mail up date

we retraced from 17631 and so far we have made low of 16736. it is aprrox 50% retracement level of rise from 15748 to 17631. more over if we consider this correction in abc pattern, a from 17631 to 17039 ( 592 ) b from 17039 to 17319 ( 280 ) and c from 17319 to low so far today at 16736 ( 583 )
a = c , 200 dma is also around 16800.......time for a reversal in up ward direction must come soon...

NEXT RESISTANCE ZONE 17800

i will like to draw attention about some technical nos.

if we consider last intermediate tops and bottoms made, we made last intermediate bottom of 15748 , before that we made intermediate top of 18524. we have seen apprx 75% retracement since top of 21109 no of times . 75% retracement zone comes around 17830. more over if we draw a trendline connecting tops of 21109 and 18524 next resistance zone comes around 17800.

we have closed above 17500 today.so i feel gradually we should book some profits and generate cash levels when we are near 17800.equivalent zone in nifty may be around 5400.......

STOCKS LOOKING GOOD FOR SHORT TERM

ASHOK LEYLAND CMP 25.25,  STOP LOSS CLOSE BELOW 24.00
ALOK IND CMP 18.3,  STOP LOSS CLOSE BELOW 17.50
SCHNEIDER ELECTRIC INFRASTRUCTURE LTD. CMP 82.5 stop loss close below 72.00

STOCKS LOOKING GOOD FOR SHORT TERM ON CHARTS

Dewan Hsg (DHFL) - 174, Zydus well - 419 , Fkonco - 91 , Kohinoor foods - 27.40 looks good on charts 

SENSEX AS ON 15.06.2012

chart attached with comments

sensex two channels as on 17.05.2012

chart attached