A pullback started, could go a little bit more but that is just my guess. I like to just react to what happened instead of predicting ahead. Predicting anyway has nothing to do with trading successfully. Today’s pullback happened on strong volume indicating lot of profit taking.
Picks
None of yesterday’s picks triggered entry signals and they all appear on today’s scan. A down day usually gives too many picks because I am looking for oversold condition and a down day results in oversold condition for many stocks. I am listing the only stocks that I like (the charts & reward/risk look good).
Valid Picks from yesterday’s scan: SATYAMCOMP, TATAMOTORS, ICICIBANK, RELIANCE, BOMDYEINGPicks from today’s scan: COCHINREFN, HOTELEELA, PNB, CHAMBLFERT, UNIONBANK
Stocks to watch: The following stocks are extended at the moment and worth waiting for a pullback: STER, HEXAWARE
Hiren said
In a majority like hotelleela, pnb,union bank etc its just a down day or a bearish day. The moving average is still sloping upwards
In a majority of cases, isn’t the price supposed to touch moving average while going down or still better the MA sloping downwards. This does not seem like a genuine dip
SwingTrader said
>>In a majority like hotelleela, pnb,union bank etc its just a down day or a bearish day.
Yes, I am looking for oversold condition in an uptrend and oversold condition usually is on a bearish day. What is your question?
>>In a majority of cases, isn’t the price supposed to touch moving average while going down or still better the MA sloping downwards. This does not seem like a genuine dip
It all depends on your strategy. I am looking for oversold condition defined by Fast Stochastics (3,1) falling to 20 or below, that is satisfied by all the stocks I have listed.
How do you define a genuine dip? That will answer the question for you. For me a genuine dip is what I have just described above.
SwingTrader said
I just did a backtest on my trade statistics to see if there was any correlation between the extent of the dip and the trade being successful and I found that there was absolutely NONE.
I strongly believe that over many trades the extent of the dip doesn’t matter at all. I have found that in the end most of my trades are winners because I managed the trades well and not because of my entries. As Dr. Van Tharp says in his book – if you have good exits & money management strategy you can win on a random entry too.