Crude Oil has spent the last 18 months in no man's land, after topping out in early 2012. During the past 6 months the commodity has been showing signs of bottoming out, it has also attempted to start an uptrend at 4947. In the end the trend failed to materialize & dipped to breach an important support at 4925 with a close of 4844 on the 15th of April 2013, it is now on a down trend.The intermediate trend in downwards, so traders can go short on the commodity. The lower supports as of now are 4654 & 4925 (which was previously violated). Resistances - a minor resistance at 5080 & major resistances at 5235 and 5517 for now.
In the long term Crude Oil is still shows signs of bottoming out, but the bottom is so far volatile & on an intermediate down trend. This tells us to be cautious & to stay out of investing in Crude until the trend reverses with a proper base formation or until the breach of an important resistance significantly.

TCS has been in an upward run for a long while; recently on the 28th of March 2013 it had made an intermediate top of 1575 & has dipped since then. 1400 is an important support & it has been marked on the chart, today’s closing was seen at the price of 1452.5 which is just above the very crucial support level, the stock might dwell at this level for some time & then rise up again. 1600 is the recent high & also a very important resistance, if the security closes above this level on a daily basis with a significant candlestick pattern it will move up to form new highs over the coming months.

But, investors as well as traders should watch the support at 1400 closely & if market breaches below this level it will move towards the lower supports of 1250 & 1175. Further if the stock closes below 1175 on the daily basis TCS will no longer remain in an upward trend.

What are candlesticks?
There are many different kinds of stock charts in use, but Japanese candlesticks are probably the most commonly used by many experts all over the world. This style of charting is considered to have its roots in the Edo-period rice markets of Japan. Historians estimate that they took their present form in the latter half of the Meiji period (late 1800s). Originally, they were just sticks drawn in red or black.

In a daily time frame chart, a single green or red candle expresses price movements for a single day; in a weekly time frame chart a single candle expresses price movements for an entire week. Candlesticks are used even on lower time frames for instance 5 minute charts or 60 minute charts.

The graph below shows different types of red & green daily time frame candles, where each candle represents the price action of a single day.

How to read candlesticks?
A candle consists of two parts, "the real body" & "the shadow". The thick part of the candlestick is called the real body, it represents the range of the stock’s opening & closing. The thin lines above & below the real body are called the shadows. Shadow above the real body is known as the upper shadow & under the real body is called lower shadow. Top price of the upper shadow is the high of session & low price of the lower shadow is the low of the session.

As shown in the diagram below, when the color of the real body is green it means the close of the session was higher than the open. The bottom of the real body is the opening price & the top of the real body is the closing price. The shadows represent the high and low of the session respectively.

If the real body is red it expresses that the close of the session was lower than the open. The top of the real body is the open & the bottom of the real body is the close. As in the earlier example the shadows represent the sessions high and low.

How Candlesticks are drawn?
Let us have a look at how candlesticks are drawn. To draw a daily candlestick you will require the open price, closing price, low & high of that days movement. Let's suppose that intra-day stock prices on a day moved from 9:00 AM to 16:00 PM & produce an upward moving line graph as shown below:

Or a downwards moving graph as shown below :

We can express these above line graphs as candlesticks. A green Candlestick expresses that market has closed above the opening price, in other words closing price of the stock is greater than opening price of the stock. The image below shows the price movement of a positive closing market, where market close is higher than market open, which has been mapped into a green candlestick :

A red candlestick, as in the below image, expresses that the market closed below the price of the opening. In other words opening price of the stock is greater than the closing price of the stock. The image below shows the formation of this price action into a red candlestick :

Candlesticks express stock price movements over a set period of time, either one day or one week or an hour etc. Regardless of the time frame, the shape of the candlestick & its combination with the other candlesticks can be used to identify the market’s direction & its relative strength or weakness & that is the main purpose of the candlestick charts.

Silver has made a top of 65670 six months ago. It has entered into a downward trend during the last week of November & has been falling since then, recently it has broken a very important support of 51000. The question arises now, what is next the move of silver?

If silver stays below 51000 for the next few days, it will try to find support near 48500. The zone from 51000 to 48500 is very important, where silver might dwell for a couple of weeks & move upwards but if it breaks the very crucial level of 48500 it will head for new lows.

Bank nifty has made a top of 12975 two months ago & is moving downwards since then. It has broken a very important support of 12300 it tried to retrace back but the upward move was not sustainable. Presently the market is at 11320, hence the question arises how far is the downward trend going to last?

Since the market has broken a crucial level of 11488 there is a strong possibility that market will touch the level of 11202. Investors who are still holding their positions can wait a little more & watch the market action very carefully at this level, traders who have already grabbed an opportunity to short the market at higher levels can partially book their profits.

On the eve of the RBI monetary policy let's look at the Indian rupee today.
The USD/INR pair (Indian rupee) topped out during July 2012 and fell to a 6 month low recently. Now it seems to have found some support at 51.5, this could however be a temporary support. If the pair is unable to move above the strong resistances of 54.5 and 56.5, the Lower critical support of 50.5 will be tested and if this support is violated we could see the rupee slide further lower. However if the higher resistances are taken out effectively we could also see a new up move.

Anil Mehta - New Delhi

Stock holding  - Omnitech Infosolutions
Buying price – 133

According to us the buying should have been initiated only if the stock moved above 155. But you have already initiated your positions so watch for two very crucial levels of 119.8 & 106.6. If the stock closes below these levels, exit from your position.

Rajesh Kumar - Bangalore

Stock Holding - Oberoi Realty
Buying Price – 265

This stock still hasn’t come out of its bearish move; important support levels are 225.55 & 201.55. If stock closes below these levels it’s not worth holding.

Today I’m posting my views on USDEUR. The market is at a very crucial level, if it breaches the very important support level of 0.8105 it will head south & try to find a support around 0.7797 levels.

Important levels are mapped out on the chart below.

Daily USDEUR Chart.

Today I’m sharing my views on Dow Jones Industrial Average.

Dow Jones has been in upward move since mid-2009, according to me it is still bullish, 13300 is a strong resistance but if Dow breaches this level it will head for new highs & first target would be around 14500.

11500 & 10000 are very important supports, if we see the Dow breaking below these levels it would be the beginning of a bearish move.

Dow Jones INDL A – Weekly Chart 

All the important supports & resistances are mapped out in the chart above.

Gold was in a short term correction for the last thirty days; it has found support around 29000 levels. I see an upward run of almost 2000 points from this level.  If the market successfully breaches the level of 30,000 it will definitely try to touch 31,000 levels.

The supports for this upward move are mapped out on the chart below at the level of 29100 & 29400.

Gold 10GM – 1 Kg daily chart.

In long term run gold is still bullish, 30500 & 31300 are important resistances, gold might dwell in these levels for couple of weeks but later it will head for new highs.

Important resistances are mapped out on the chart below.

Gold 10GM – 1 Kg Weekly chart.