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Friday, 22 February 2013

Which stocks to trade–22 Feb : Short on rise Tata Steel, L&T , SBI, ICICI Bank

Dear Readers, As I have been writing here in the past few days, Nifty and many pivotal stocks, L&T, Tata Steel, SBI, Reliance, ICICI Bank all have fallen significantly. This market is clearly sell on rise, until we see a sustained upmove.
All sectors except IT are in sell mode in daily and hourly charts. Will there be a bounce back ? A possibility cannot be ruled out. Hence wait for atleast 20-30 minutes after market opening to start trading.
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In case of a bounce back, short once the charts give negative signals like MACD bearish cross in 5 min charts. Look at days high, previous days high/low to take decisions.

Which stocks to trade ?

I am not looking at any new stocks, I will continue to short Tata Steel, SBI, ICICI Bank and L&T.
1. Tata Steel – Next target is 360 as I wrote yesterday here. Do not sell Tata Steel if it stays above 368. Simple reason is, majority of the selling (look at volumes in the chart), happened when the stock was below 368. If the stock moves above 368, then short covering will start, shorters will start exiting in panic and violent upmoves will be seen.
My earlier posts on Tata Steel.
2. SBI – Sell only below 2220, above that the stock will only move up for reasons same as above. If SBI crosses below 2200 and sustains there which was a significant support in the past, then there will be heavy fall.
My earlier posts on SBI
3. ICICI Bank – Next stop is 1050. Again short below 1090  which is the daily pivot.
4. L& T – 1435 looks like significant resistance for L&T now.
Most of the above levels mentioned are simple daily pivot points. No rocket science here. Technical Analysis Simplified !!
22 Feb will be a very tricky day to trade since I expect some violent moves. Next one week could be difficult to trade due to expiry related volatality as well. Trade less, trade carefully. Good luck.

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