Time to go long!

Markets are looking good. Its time to go long...I had made long positions before the budget, it was kind of a risk that I took, however the thing going positively for this move was that the charts were supporting a pattern of receding MACD and moving towards the 0 mark indicating that things would be changing direction soon....This has got validated with the huge buying of FII's in F&O to the tune of 1600 cr in index futures.....

More so now with the Greece bailout package being discussed, things look as if they would be ok for some time....I have taken positions at 4862, and my aim is to make 300 points in the nifty in one year. Cause just with 300 points you can make around 50% return on ones capital...sounds simple...lets see how it goes :)

Nifty Sluggish

Nifty could not hold onto any gains. What is more problematic is that we had reached 4650 odd in June. Today is feb, 9 months later we are still hovering around these levels. This does indicate that its very difficult making money in this type of a market. In such markets it makes perfect sense to trade, and trade in futures as you can take both directions.

I went long at 4712, however markets fell down and my stoploss got triggered at 4685. However when the markets immediately came up, I again went long at 4722, and covered at 4797. And glad I did it as markets fell down today.

Markets look weak and will look at a good chance to get in.

Trend Sluggish

Nifty could not hold onto any gains. What is more problematic is that we had reached 4650 odd in June. Today is feb, 9 months later we are still hovering around these levels. This does indicate that its very difficult making money in this type of a market. In such markets it makes perfect sense to trade, and trade in futures as you can take both directions.

I went long at 4712, however markets fell down and my stoploss got triggered at 4685. However when the markets immediately came up, I again went long at 4722, and covered at 4797. And glad I did it as markets fell down today.

Markets look weak and will look at a good chance to get in.

Going Long

Hi, sorry havent written in a month...actually havent done much except being on the sidelines... saw the markets tank from outside....did not have the courage to go short....

Well will be taking long position tomorrow. 3 reasons

1) RSI has come down to 30 levels they will go up, (although it might be small only)

2) New series with perfect set up to go up

3) Encouraging global data, with US economy going up by 5%

Although a word of caution, keeping a stoploss is warranted

Happy trading!

Markets in a happy mood

The markets seemed to have entered a new upturn with the resounding U turn that they took on 23rd. Nifty is nearing to touch the 52 weeks highs and same is the case with sensex. Most good stocks have already crossed their 52 weeks highs. All seems to be hunky dory and there seems to be money to be made in holding on to your stocks. I am just attaching a sample of the graph showing how, Nifty was supposed to go into a downtrend, as MACD had approached 0, and usually MACD goes below 0 and it is a start of a downtrend. However the converse is also true that MACD goes above 0 is a good time to go long. I guess now the same thing is happening with the MACD bouncing from 0 levels, the markets are in a rally mode. The futures are still at a premium underscoring the fact that lot of people have burned their fingers / hands trying to short the market, and are now extremely positive of a good closing.

Will keep posting as some interesting developments happen. Till then it seems that the party is on...Wish you all also a happy new year!

Directional Change

Sorry, havent been able to post for a long time, will try to rectify this.

Markets did a surprising U turn today. It was a perfect set up for a decline, with all indicators pointing for a breakdown, however todays move changed all that. I dont remember the last time, when indicators changed so quickly. It was a good case of bulls getting trapped and huge short-covering. Nifty futures from a discount, ended with a 10 point premium.

The moot point is that it would take a lot to break the markets, as each & every down move is faced with more wall of money coming in. With a promise of 8% gdp growth, the markets have more reasons to smile.

Nifty short covering rally!!!

I shorted the nifty and the move went wrong!!!

Markets went up by 2%, and I think this might be the start of another uptrend, since the speed with which the markets covered up was amazing. So in 3 days we have covered more than 300 points on the nifty, from a low of 4530 to 4906 (futures). So all the people who shorted in between would have lost a lot (including yours sincerely). And well this is inspite of the fact the US job losses figure is at a 23 year high of 10.2%, and the markets still rallied!!!! Now it sometimes confuses me, whether the markets see more than what meets the eye, or is it some play larger than what normal mortals can think off!!!!

I am now taking a break, as I think I need to rework on my strategies to play the markets profitably. In any case would keep on posting, if I find something interesting coming along....Happy investing....going long....

Change of timings!

Sebi has given an ok, to the change of timing of trading on the markets...from current 9:55 a.m to 3:30 p.m to 9:00 a.m to 5.00 p.m (proposed). Hopefully this would help the retail investors to trade with much more ease...good move!

You could soon be able to trade for an additional two-and-a-half hours on stock exchanges with the Securities and Exchange Board of India (Sebi) on Friday allowing trading between 9 a m and 5 p m to align timings to international standards.

At present, trading hours are between 9.55 a m and 3.30 p m.

Sebi, however, raised the caveat that the exchanges would have to ensure that risk management systems and infrastructure commensurate to longer trading hours were in place before investors transact for eight hours a day.

TRADING PLACES
	Local trading hours (a m to p m)
	Cash	Futures & Options
New York	9:30 to 4:00	6.00 to 5.00*
Singapore	9:00 to 5:00	9:00 to 5:00
Tokyo	9:00 to 2:00	9:00 to 7:00
London	8:00 to 4:20	8:00 to 9:00
India (now)	9:55 to 3:30	9:55 to 3:30
India (soon)	9:00 to 5:00	9:00 to 5:00
Source : Bloomberg * 23 hrs

The National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) welcomed the Sebi move and added that they would soon extend trade timings. They, however, did not clarify whether timings would be extended to 5 p m, though executives indicated that trading would start at 9 a m.

Last year, NSE had first proposed a change in trading hours at a time when foreign institutional investors and hedge funds preferred to trade on the Singapore Stock Exchange (SGX), where NSE Nifty futures were also listed. With longer trading hours because SGX opened for trading at around 6.30 a m India time, the open interest positions on Nifty futures traded on SGX had reached close to the levels seen on NSE.

“Extending trading hours will improve liquidity and volumes in the market,” said Motilal Oswal, chairman and managing director, Motilal Oswal Securities, adding that the move could also help shift a part of the trading back to the Indian exchanges.

Asked about longer trading hours, a BSE spokesperson said, “We welcome the Sebi directive and we are well-prepared.”

Currency derivatives trading starts at 9 a m and ends at 5 p m, so extending trading hours to equity and equity derivative segment should not be difficult.

Market participants, however, said widespread changes would be required for exchanges to allow trading for eight hours a day. Banks that are involved in settlement, brokerages and exchanges could see an increase in manpower costs , executives said.

They said the risk and collateral management systems would need to be revamped. Further, trade margins would have to be increased and the infrastructure at brokerages, banks and depositories need to be upgraded to handle the additional pressure.

"Though it's a good move that will help us synchronise with the global markets, it may affect productivity because the time for analysis will get squeezed. It will delay the net asset value declaration of mutual funds by at least an hour," said a fund manager with a domestic mutual fund.

“It’s a very positive step. It’s just that market participants will have to realign some processes to deal with longer trading hours,” said Bhavesh Zaveri, head of wholesale banking operations and cash management products at HDFC Bank, the country's largest settlement bank.

An executive at a leading settlement bank said counters would have to open around 8 a m to allow brokers to move funds before trading started. Similarly, the Reserve Bank of India would have to allow real time gross settlement up to 6 p m instead of the 4.30 p m deadline at present, another banker said.

Further, exchanges would have to realign their systems to ensure that pay-in-pay-out files related to settlements are completed faster. At present, when trading finished at 3.30 p m, banks and depositories receive the information related to payments and transfer of shares around 8.30 p m. “This needs to be crunched because we would already be open for 12 hours a day,” said a bank executive.

In addition, a bank executive said entities that are not settlement banks would also need to work longer hours to deal with broker transactions.

source: business standard

nifty 2009 highs

Nifty seems to have rebounded well from 4930 odd. What happened on Monday was phenomenal. The markets went down to 4955 and around 1:30 pm, it just burst up. I had shorted the market at 4980, but thankfully I had put a stop loss of 4990, which got triggered. The markets went up from 4955 to 5020 in minutes, and eventually closed at 5050. And that is where the current weakness seems to have ended. So far so good. Have gone long with some select stocks, lets see whether the markets hold up.

Sharp Rebound

Shorted the nifty at 5030 yesterday, covered it at 4940 (luckily) today. So got around 90 points from Nifty. Now the level of 5070-5090 becomes very very important to see. If Nifty breaks over the 5070-5090 level, then I dont see much of a possibility of a break down. . .Trading on Nifty is becoming increasingly tricky, and although I made 90 points on the Nifty (and thankfully most of the calls I am making are more or less accurate) yet it is difficult to make money...so its not only important to know app what is going happen, but also use the right setups to ride profitably these trades. Like for e.g. day before yesterday, it was impossible to predict if Nifty would go down, yesterday it was still predictable, but if someone would have shorted yesterday and not covered today then there would have been loss instead of making any profit....

So where do we go from here...caution is very important...now more so than ever...I dont have the conviction to go long and nifty is not allowing to short for a long time...lets see will keep on posting if I find something interesting. And yes I sold off Paradyne (Glodyne) for no profit no loss...though its a multibagger, yet when markets go down, all stocks go down with it....lets hope Oct end is nice shopping time :)

Why you should be cautious in October!!!

World markets have started to correct and we are precariously hinged on top...doesnt look good.

October traditionally has not been favorable in any case & this one doesnt look good anyways....

Yest the FII's bought a great amount of money (i think around 700 cr) and yet markets were flat, my fear is what will happen if they start to pull out. FII's put in around 20K crores in the month of Sep, so if they stop markets might not have the support to hang on where they are.

Chartically also we are not looking great, with RSI going above the danger mark and making a double top....the point is that its better to be cautious. . .specially now that the global markets have started to correct. . . .

Lets see where this series leads us....I wont be taking long positions until we break 5200....

Risk Reward

Its just been 6 months since march lows of 7500 on sensex and all seems forgotten! Just as there was all round gloom then, there is huge euphoria now. . .however perhaps the only saving grace is that still the panwalla near us has not started to give advice on stocks (which had happ at 21,000). Anyhow coming back to the markets, markets seem to be happy as ever. . .with individual stocks doing well. . .

I had bought Cummins back at 334, could not stay away from the markets, so had the good fortune to ride the 10% wave yesterday. Though I squared my positions today. . .Now I am looking for some less strenuous trade. . .

I have a hypothesis though. . . . . .in October sometimes, markets see a huge sell off. . .it happened last year, it happened in 2005. . .I am not saying it will happen this year also. . .but what if it does. . .I am planning on a strategy to ride it profitably, if it happens again. . .however a word of caution it is 2 times more difficult to make money shorting. . .rather than going long. . .anyways lets see if there can be a profitable trade somewhere. . . Also I am looking at the banking sector that has suddenly caught the fancy of the investors, specially the public sector banks. . .wonder why now!!! guess they deserved their due to for a long time . . .e.g. most of them were trading at a PE of around 4-5. with dividend yields of around 5%!!!

interesting times ahead. . .risk reward though does not feel right currently to go blind long. . .will post as soon as I get into some position. . .I just remembered the famous quote today. . ."be fearful when others are greedy and greedy when others fearful". . .

Going Long!!!

Bought

Cummins @ 324;

Ge Shipping @ 260;

Siemens @ 484

Lets see how it goes

Taking a forced break!!!

Still taking a break, primarily because I don't see any good trades still. . .glad did not trade last week, as you saw the markets went down on Monday only to come back to the same levels by Friday . . .and in such markets its virtually impossible to make money!!!

Again scouted for a good trade, somehow still cant get my hands on a good one. . .Though I think after Fridays move, one would be inclined to go long only. . .and markets might go up. . .however I don't know how to enter them. . .I mean I am not able to find any good opportunity to enter. . .I have contemplated lots of strategy including bull spreads, buying NIFTY futures, selling puts, buying NIFTY BEES, even buying MF still cant place my hand on a favourable risk return ratio. . .

Lets see if I can see something more clearly would definitely scribble it down here. . .till then guess holiday time. . .

Valuations are not cheap anymore! But who can question liquidity

I was just reading an article on a blog on how the markets have been a roller coaster ride throughout 2008-09, and the article beautifully summarised the feeling that the investors went through starting 2008 January. A feeling of euphoria, in Jan 2008, to a feeling of buy on dips in June 2008, to a feeling of let me put it all (but am i doing the right thing) in Oct, to a feeling of let me book my losses and I will never come back to equities in March 09, to a feeling of oh no did I miss the bus in May 2009. . .

I agree that most of us would have gone through this feeling, leaving perhaps some of the few who had the vision and the good luck to time the markets to perfection . . .well as far as my personal experience goes, I was not invested much in Jan 2008, I was mostly in cash. . .in June 08 I had started to invest but not much I would say, in Oct 2008 I put in all I had with the fall in the markets. . .(read my article I wrote in October) in March I also questioned my decision, however I remained invested (read my article I wrote in March) and well started a FD side by side (you cant have all the money in equities, this feeling dawned into me for the first time then). . .I stayed invested in May (obv trading positions) and gradually i have booked profits since then. . .but one thing is for sure, March tested my conviction in the markets as well. . .

Also I was thinking actually its very very difficult for an average investor to make money in the market, if you don't do your analysis well. . .If you don't trade with paper money first, if you don't know technical analysis, if you haven't seen a bull and a bear market (and hopefully survived the bear market) then your chances of making money actually start to dwindle . . .However even if you know all these one bad move can wipe you out of the markets. . .E.g. if someone had shorted NIFTY futures just before the election results. . .Lets say shorted 4 Nifty futures (which is not much for the fun of it, or lets say someones friend had advised him to short or someone might have got a tip! whatever might have been the reason) but lets say 4 Nifty futures worth 1Lakh. . .As the margin money for one future is Rs 25,000. Now with 35 sec of trade (which I am sure all amateur traders would have missed on the opening of the markets post election results) that particular gentleman would have lost . . .any guesses??? Rs 200*800= Rs 1,60,000. Now that is a lot of money to lose in 35 seconds. . .now to make that 1,60,000 would require a capital of 20 Lakhs (assuming you get a 8% return). . .Hence that'sthe end of our amateur investor who invested on tip. . .The point I am trying to make here is that for the average investor the odds are sometimes stacked heavily against. . .hence the decision to buy and sell should be taken with utmost care and guess the bottom line is that minimise your losses and book your profits. . .

Now where to from here. . .Closed my stock positions on Cummins and booked the profits.. . . Actually markets are in a range wherein they can go anywhere from here. . .there are no clear signs for the downturn however for the upside the valuations pose a challenge. . . I spent this weekend looking for some good buys, however could not even pick up a single stock that I would pick up blindly. . .some of the stocks look ok on valuation e.g. Siemens etc but again relatively speaking. . .and I dont like this feeling of not getting good bargains . . .Lets see what the next week has instore. . .

Position Vindicated

As written in yesterdays post, that I am going long on Cummins, Cummins went up by 9%, good to see some profits trickle in today. . .Glad my stand stood vindicated with going long. . .

Nifty was a tricky Trade today!

Well its not a pleasant feeling to be wrong. . .however it is important that the losses should be minimised. So at the start of trade I took some positions on the Nifty at 4528 however soon realised that the market was not obliging, I closed my positions at 4497, I had kept a stoplossof 4480 for today as I knew if the market breaks below Fridays close then it means that the Nifty is showing signs of weakness. . .Hence I lost 30 points on the Nifty, lesson learnt . . .( lesson of not to jump into trade within the first 30 min of trade).

Anyhow I think what broke the back of the market, was the announcement of drought, also the pandemic in the country would also perhaps weigh on the markets at some point or the other. Anyways the good thing I did perhaps today was to go long on stock. . .bought cumminstoday, however will have to be careful if the markets collapse, then nothing much would be able to stand the selling pressures. . .

What worries me is the huge discount between spot and futures. . .this basically means huge huge shorting has happened on the nifty futures. . .but this also means that if the marketsdont fall then there would be huge huge shortcovering and this might lead to a real swift rally on the upside. . .

I am not giving any directional call, since I am not sure the way markets would move. . .the charts are still positive. . .however the discount on the nifty does worry me. . .well one thing is for sure markets are supreme and they teach you that you would be wrong, so one needs to be humble and accept mistakes :)

NHPC IPO

I am not a big fan of investing in IPO's, primarily because there is no clear vision in terms of earnings, or track record to follow. . .however whenever an IPO comes, there is a huge exuberance in the market and well almost all the people want to get a share of the pie. . . I clearly rem the reliance power IPO, wherein almost every one I knew had invested. However what has happened since is for everyone to know (inspite of the company issuing additional shares to people who had subscribed, which I believe was a very good thing). . . Not to mention issues such as Jet airways, DLF etc etc. . .which went below their issue prices.

The point is there are lots of good issues also that hit the market and are priced reasonably, however there is no track record of them or there is no technical analysis to fall back on, hence it becomes important to value them precisely. . .

Came across a nice article on the NHPC IPO , seems like an expensive IPO. . .but then I guess even this one is oversubscribed. . .

My Strategy for next week has been firmed up, would be going long. . .on selective stocks.

Profits booked at the right time

As written in the previous post, on my other blog, profits booked at the right time. . .markets crashed big time in these two days. . .now where from here. . . well the charts have not gone into negative territory, infact I think it might be a smart time to buy for people who know what they are getting into. . I think the risk reward has become favourable ( but you must know which stocks you are getting into) although a word of caution it might not be the same for all the stocks. . .

My strategy for the next week is not firmed up yet. . . though one thing is for sure I wont go short. . . .will keep posting . . .

Do write in with your comments. Its always nice to hear your thoughts. . .

Money Multiplier!!!

Well so markets indeed went up, I am glad they did. As written in my previous post, I had added more positions in GE Shipping, and well it paid off very well. GE Shipping closed with 5% up, and well thankfully now both my trades are in positive. . .Now what will I do from here, well ride the wave till it lasts (depending on the technical signals) but yes I would be cautious for how long to carry these positions. . .

However once the positions are closed and profits booked, where should that money be deployed. Well there are two thoughts to it. One add more positions or second invest that additional money to take unduly high risks (well so that the profits are unduly high. . .) I am not sure which strategy would I adopt, but I am inclined for the latter. . .This type of strategy usually comes in as a money multiplier strategy, as one is employing the money that has been made as profits well to earn super high profits . . .Well some of you might be wondering what these highly risky strategies are, for a starter buying naked options is one. . .naked options are when one buys calls or puts without covering the positions in actual stocks or futures. . .

Now where from here. . .my sense as written earlier Nifty seems to be comfortable at the moment. . .no heavy signs, no overbought situation etc. . .so one can breathe easy till the time new developments take shape. . .And as far my 2 stocks goes they have kind of entered an uptrend so the moves would be sharp on the upside (provided the broader markets hold)