#technical analysis tool

As a trader navigating the ever-changing seas of the financial markets, I'm constantly on the lookout for tools that can sharpen my analysis and give me an edge. That's why I'm excited to share my experience with the Supply and Demand Indicator (SDI), a digital product that has become an integral part of my trading arsenal.

Unveiling Hidden Order Flow: A Game Changer

One of the biggest challenges for traders, especially beginners, is deciphering the underlying sentiment behind price movements. The SDI tackles this head-on by utilizing a unique approach to highlight areas of supply and demand in the market. These zones, traditionally identified through complex order book analysis, become readily apparent with the indicator's visual representation. This allows me to quickly gauge where potential buying and selling pressure might be concentrated, informing my entry and exit points for trades.

Beyond the Basics: A Customisable Powerhouse

The beauty of the SDI lies in its customizability. The indicator offers a variety of settings that cater to different trading styles and preferences. I can adjust the timeframe, display density, and even the color scheme to perfectly align with my trading strategy. This level of control empowers me to tailor the indicator's output to my specific needs, ensuring it seamlessly integrates with my existing technical analysis toolkit.

Seamless Integration for a Streamlined Workflow

The digital format of the SDI is another major plus. As a member of the membership area, I have instant access to the indicator, allowing me to use it across various charting platforms. This eliminates the need for cumbersome downloads or installations, keeping my workflow efficient and streamlined. Additionally, the membership area provides ongoing support and educational resources, ensuring I can continuously improve my understanding and utilization of the SDI.

A Catalyst for Confidence and Profitability

Since incorporating the SDI into my trading routine, I've noticed a significant improvement in my ability to identify high-probability trade setups. The indicator's clear visualization of supply and demand zones has instilled a greater sense of confidence in my trading decisions. This newfound confidence has translated into more consistent profitability, making the SDI a valuable asset in my trading journey.

In Conclusion: An Investment in Your Trading Success

Technical Analysis Tools to Monitor Currency Movements

There are several tools available to help you monitor the movement of currencies. Some of these tools are Moving averages, OBV, and Parabolic SAR. These tools are very useful for the currency trader who wants to monitor currency movements and find profitable opportunities. However, you should not use any of these tools as a substitute for personal judgment. OBV OBV technical analysis tools to…

You found a company with an amazing product. Strong demand was fuelling big earnings and sales growth. Mutual fund sponsorship was top-notch, and the stock was in a bullish technical pattern. But the stock went lower soon after you bought it because you were wrong about the direction of the general market.

Mistakes are plentiful during a market downtrend. Avoid these common ones, and you will be able to keep your hard-earned cash intact.

Buying before a base completes

During the recent market correction, many stocks pulled down to their respective 200-DMA and only some found support. To some traders, long-term support was a buying opportunity. The key to making money in the market is waiting until a base completes before buying. In most cases, stocks that come down to their 200-day lines do so amid signs of institutional selling. Wait the stock to prove itself more, and look for signs of institutional buying as the stock builds the right side of the base. Then you have a legitimate base.

Buying every possible breakout

Bullish stock charts tempt investors all the time during down markets. Some growth names will hang in there with compelling charts. A breakout may work for a while, but it will likely be short-lived. While stocks that hold up the best during down markets can go on to be the next leaders, they still should not be bought during a downtrend.

Keep holding a stock or even averaging down

A stock trades at Rs 100 a share. Your cost basis is Rs 100. The stock heads lower, and you buy an equal amount of shares at Rs 80, lowering your cost basis to Rs 90. Then you add further at Rs 75 after it breaches its 50-and 200-DMA. The problem is that you’re averaging down in a former leader that’s under tremendous institutional selling pressure. You will be doing some serious damage to your portfolio. It rarely makes sense to buy a stock that has the potential to spiral lower before finally hitting a bottom.

Buying low P/E stocks

Price-to-earnings ratio is a common valuation tool. But buying/selling decision based on P/E is not a prudent move. Expensive stocks can become cheap, but cheap stocks become cheaper in a down market. Trying to catch a stock “on sale” is fraught with risk. In many cases, stocks with low P/E ratios are suffering from weak fundamentals, where shrinking market share results in lower earnings growth. That’s not something you want to see in a stock. Remember, some of the best merchandise in the stock market often sells at a pricey valuation due to strong fundamentals and bullish growth prospects.

Stop paying attention

It is easy to lose interest when stocks are selling off, but market downtrends let high-quality names take a breather and eventually build new bases. When a new uptrend is confirmed, breakouts deliver the biggest gains. During a market pullback, try hard to make a list of stocks that held up the best. A few will show limited signs of distribution (heavy-volume selling) on the way down and accumulation (high-volume buying) on the way up. Focus on the most resilient names with the least amount of technical damage. They will generally be your best prospects.

Read our last week article on “Still the No. 1 Rule for Stock Market Investors: Always Cut Your Losses Short”

Today’s Action

Nifty, +0.8%; Sensex, +0.7%; Nifty Midcap, +1.8%; Nifty Smallcap, +2.8%; Model Portfolio, +2.0%

Market Pulse Confirmed Uptrend

Nifty, after a negative opening, closed the day around 70 points higher. It made an intraday high of 9,053 and closed below 9,000. Today, 70% of Nifty50 stocks advanced, led by Ntpc (+5.8%) and Vedanta (+5.2%). On the flip side, Hcl Technologies (Nse) (-3.9%) and Tech Mahindra (-3.9%) were the major decliners.

Barring Nifty IT (-1.9%) and FMCG (-0.6%), all the sectoral indices closed higher. Nifty Media (+2.6%) and Nifty Bank (+1.8%) were the major advancers. Of 2,116 stocks traded, 1,331 advanced, 462 declined, and the remaining traded flat.

We continue to be very selective about taking any fresh positions. It is important that investors don’t play all their cards at once. We would suggest adopting an investment approach where you begin with a small allocation and increase it as and when the market advances further.

Without trying to predict and decode stories, we will take what the market gives us and continue to monitor unfolding conditions. Stocks with higher relative strength and superior fundamentals can do well. Some leading stocks have sharply corrected. Wait for them to put in at least a short period of consolidation and show a constructive breakout from that range. Buying without this period of constructive behavior into a straight upmove off the bottom, puts you at a risk of drawdown.

Key News

Larsen & Toubro received ‘significant’ orders during January-March quarter. ‘Significant’ category orders range between Rs 1,000 crore and Rs 2,500 crore.

Vodafone Idea enhanced network capacity in the Delhi-NCR circle by deploying the most efficient 900 MHz spectrum band on 2,300 4G sites to cater to rising demand amid coronavirus lockdown.

IL&FS sold its 100% stake in IL&FS Wind Power Services to ORIX Corporation, Japan for Rs 6.05 crore.

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Today’s Action

Nifty, -0.8%; Sensex, -1%; Nifty Midcap, +1.3%; Nifty Smallcap, +1.3%; Model Portfolio, -0.2%

Market Pulse Confirmed Uptrend

Nifty, after a gap up opening, traded in a narrow range in the first half of the trading session. However, the index shed all its gains in the last hour of the day and closed in negative territory. Further, Nifty added a distribution day as today’s volume was higher than the previous session.

On the sectoral front, results were mixed. Nifty Financial Service and Nifty Bank were the major decliners, which lost more than 2% each. On the flip side, Nifty FMCG (+4.1%) gained the most followed by Nifty Realty (+1.8%). The advance-decline ratio was in favor of advancers. Of 2,111 stocks traded, 1,208 advanced, 588 declined, and the remaining traded flat.

We continue to be very selective about taking any fresh positions. It is important that investors don’t play all their cards at once. We would suggest adopting an investment approach where you begin with a small allocation and increase it as and when the market advances further.

Without trying to predict and decode stories, we will take what the market gives us and continue to monitor unfolding conditions. Stocks with higher relative strength and superior fundamentals can do well. Some leading stocks have sharply corrected. Wait for them to put in at least a short period of consolidation and show a constructive breakout from that range. Buying without this period of constructive behavior into a straight upmove off the bottom, puts you at a risk of drawdown.

Key News

Lupin (Nse)(-1.9%) received the Establishment Inspection Report after closure of the U.S. FDA inspection of the company’s Mandideep Unit II facility, classifying the inspection as Voluntary Action Indicated.

Cadila Healthcare(-4.1%) received tentative approval from the U.S. FDA for Macitentan tablets.

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