Trading Report For January 18, 2011


Hindalco and SBIN were my targets for this day.

The support levels for Hindalco were 220.30, 218.75, 217.20 and 215.60. The scrip had to face resistance at 229.70, 231.25, 232.80 and 234.40.

The scrip touched and crossed 229.70. I shorted at that point with the target price of 225.00. My stop loss was the next resistance point 231.25. After playing below my shorting point for a major share of the day (it even touched 227.40 at one point of time), it began to surge. The system squared off the trade at 229.80. Loss.

Something similar occurred with SBIN too today. The scrip had support at 2504.90, 2500, 2495.10 and 2490.25. The resistance points were 2534.20, 2539.00, 2543.95 and 2548.85. The scrip was trading in the over-bought zone (above 2548.85) when I saw an opportunity to short at that point. As soon as it fell, I shorted with the target price set at 2519.85. The scrip was playing in the 2540 to 2550 range for the entire day. By 14:30, it began to surge and hit my stop loss set at 2553.70. Loss.

Afterthoughts:

If you had read through my post carefully, you will understand that the prices touched the desired points and started falling (just as they were destined). They were even showing signs of even more fall in the oncoming hours. However, the scenario changed by 14:45. The index began to rise – people began to buy back in large quantities. Both the trades ended with loss.

Ironically, the camarilla equations worked fine for SBIN (buy at 2541, sell at 2561) on this day. The same equation did not work properly for HINDALCO though (buy at 229.40, sell at 233.15; the high price achieved by the scrip for the entire day was 230.60).

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