BraViSa TempleTree-India Market Calls

d_s_ramesh

Well-Known Member
#31
Enquiry is learning

Thank you Prasham, some questions bring more life into works like this. Trading is both an Art and a Science. Enquiry boosts interest.

One more applause for researching on your own than blindly taking the calls. Research kindles the learning process. In the long run it is knowledge that is king. Trading industry gives more importance to this.

We follow the Keep it Short and Simple policy in our approach to markets. We do not use RSI or Stochastic. Instead we use only MACD Lines and MACD Histogram. Many in the trading activity presume MACD as a laging indicator. But it is a very perfect indicator to follow trends.

These are not intraday trading calls, while all these stocks are short to medium term position calls. So, volume was not considered a criteria here. All these stocks fall into the CNX 500 list, which have undergone multiple screening process and rating.

It is what that is in our iner self is that reflects outside. You have had your own way of analysis and that was reflected in all the stocks. The same way, it is with what we think about our trades that materialize in reality. If you have full confidence and belief on the position you take. That will surely be a winning trade.

When does this confidence and belief come. It is only when you have followed your system 100%. So, it all finally settles with psychology. More of it later.

SUZLON, does not fit into a trend. It belongs to the Industrial Sector, which leads to the Industrial Engineering sub-sector and then to the Heavy Engineering Industry group.

INDUSTRIAL Sector has retraced bearish divergence on 22nd January 2010 week, with a very high range of 11% fall on its index value and taking off close to 2 months bullish moves in a single week. But the weakness got stalled with a strong bottom on the MACD Histogram and the Index turned up. In the present move of 8 weeks, the index was not able to give a new high. While it has moved in the sideways pattern. Both MACD Lines and MACD Histogram have turned flat along with price. MACD Histogram is still below zero. This indicates that in any turn of event this index is going to get a big hit.

We do not negate a possibility of a bullish divergence on MACD lines following the next fall. The same pattern is mirrored on the Industrial Engineering sub-sector chart. Whereas the Heavy Engineering Industry Chart has taken to 3rd lower peak on MACD lines and the same pattern on the price move too.

While all the index charts show side ways pattern with upward bias. SUZLON, chart is showing a very clear non-trend with a negative bias. SUZLON along with PRAJ are the weakest stocks of this Industry group. These are best shorting candidates once the indexes permit short.

SUZLON made a high of 145 and a highest close of 131 in June 2009, after that it was not able to reach those high levels. While the peers in this group atleast managed to re-test highs to form bearish divergence.

Our analysis on SUZLON says a big no-no to either go long or short. Once again it is our view, use your own analysis to decide. There are very good stocks which have the potential of a multibagger even now.

Thank you once again for asking a question and giving enthusiasm.
 

prasham

Active Member
#33
Re: Enquiry is learning

We follow the Keep it Short and Simple policy in our approach to markets. We do not use RSI or Stochastic. Instead we use only MACD Lines and MACD Histogram. Many in the trading activity presume MACD as a laging indicator. But it is a very perfect indicator to follow trends.

I have just started learning Chart Reading & Indicators. I am yet to read anything on MACD. Thanks for your feedback, I shall learn the same soon.

SUZLON, does not fit into a trend. It belongs to the Industrial Sector, which leads to the Industrial Engineering sub-sector and then to the Heavy Engineering Industry group.

INDUSTRIAL Sector has retraced bearish divergence on 22nd January 2010 week, with a very high range of 11% fall on its index value and taking off close to 2 months bullish moves in a single week. But the weakness got stalled with a strong bottom on the MACD Histogram and the Index turned up. In the present move of 8 weeks, the index was not able to give a new high. While it has moved in the sideways pattern. Both MACD Lines and MACD Histogram have turned flat along with price. MACD Histogram is still below zero. This indicates that in any turn of event this index is going to get a big hit.

We do not negate a possibility of a bullish divergence on MACD lines following the next fall. The same pattern is mirrored on the Industrial Engineering sub-sector chart. Whereas the Heavy Engineering Industry Chart has taken to 3rd lower peak on MACD lines and the same pattern on the price move too.

While all the index charts show side ways pattern with upward bias. SUZLON, chart is showing a very clear non-trend with a negative bias. SUZLON along with PRAJ are the weakest stocks of this Industry group. These are best shorting candidates once the indexes permit short.

SUZLON made a high of 145 and a highest close of 131 in June 2009, after that it was not able to reach those high levels. While the peers in this group atleast managed to re-test highs to form bearish divergence.

Our analysis on SUZLON says a big no-no to either go long or short. Once again it is our view, use your own analysis to decide. There are very good stocks which have the potential of a multibagger even now.

Thank you once again for asking a question and giving enthusiasm.
Thank you for such a long descriptive answer. From the above I understand that I need to learn much more about technicals.

Actually as of now I plan to trade only in Nifty Options and hence I only need to focus on short/medium term nifty trends. Any suggestions how I can "PRECISELY" judge it?
 

d_s_ramesh

Well-Known Member
#34
Options!?!

The mention of the word 'options' in your reply immediately made shivers running down the spine. There are some negativities I would like to share with you about this.

Options is a specific game. When you buy options, you have to jump through three hoops in a single leap. You have to be right on the stock or the future, right on the move and right on its timing. Ever tried tossing a ball through three rings at an amusement park? This triple complexity makes buying options a deadly game.

Many beginners buy calls because they can't afford stocks. Futures traders who get beat up sometimes turn to options on futures. Losers switch to options instead of dealing with their own inability to trade. Using a short cut to weasel out of trouble instead of facing a problem never works. This is so true even in daily life.

The expression "your loss is limited to what you paid for an option" means you can lose 100%! What's so great about losing everything?

Several years ago, a top money manger in the USA landed on the front page of The Wall Street Journal after he lost 20 years worth of profits in a single bad day of writing naked puts.

Markets are like pumps that suck money out of the pockets of the poorly informed majority and pump it into the pockets of a savvy minority. In options the majority buys calls and, to a lesser degree, puts. The insiders almost exclusively write options. Professionals use their heads, while amateurs are driven by greed and fear. Options take full advantage of those feelings.

You need a minimum of one year of successful trading experience in stocks or futures before touching options. If you are new to the markets, do not even dream of using options in lieu of stocks. No matter how small your account, find some stocks and learn to trade them.

In India, we have a good futures product for small traders, 'MINI NIFTY' with as less as Rs. 10000 as margin money you can take position in a Mini Nifty contract. You may feel that, it will give you just very small money compared to your calculations from options. But, take my word, its small drops that make a mighty ocean.

Opting to make it big in few trades is the thought every trader has, Even we too were of the same group thought, until we lost almost all our capital along with tonnes of profits made in short term gains. Finally after few years of toiling effort and spoiling health, we learnt it the hard way, that making it small with consistency in the long run gives great returns. That is value addition.

We are sorry if we had hurt your feelings about trading options. Let us make everyone we come across be happy is the thought behind all our works. After our experiences with the markets in various ways, everyone we come across hearing that they are trading options, we give our only advice, 'There are far better opportunities in Stocks and Futures, explore them'. Concentration, confidence and belief will make you achieve your goals.

A very simple system of trading moving average crossovers with discipline and belief in Mini Nifty can fetch you bare minimum 30% gains year on year on a 30K investment. Just calculate the compounded returns for 10 years, your capital will be 3.18 lakhs in 10 years. A growth of 960%, this for just following a very simple system.

The discipline we talk about here is the staying power when there are many whipsaw trades. If you wish to make money trading, you have to be with whipsaw trades.

Think hard before risking your hard earned money, time and effort into any avenue and multiply it.

Happy trading.
 

prasham

Active Member
#35
Thanks for your extensive post to guide me in the right direction. Moreover I am highly obliged by your gesture. No one shares their experience, atleast not the one that was learned the hard way, for FREE.

As far as options are concerned, I am concentrating fully on them just for the reason that I can apply lot of strategies to gain from it unlike in equity. Moreover I already have an equity portfolio which I am quite satisfied of. Simple strategies like spreads are limited risk/reward which is exactly what I am seeking as of now. I understand your point about loosing 100% but I am not planning to trade naked calls/puts. Plus I clearly understand that more than 80% of options expire worthless & hence I wish to learn writing options as I gain some working experience.

Currently I am learning TA just to get some insight into how short/medium trends of Nifty. On basis of my judgement I make some paper trades and see the outcome. I am in no hurry to take a plunge into the market. I shall prepare myself first with proper tools and only then shall try out staking Real Money. Moreover I shall not stop building my equity portfolio, its just a temporary brake to concentrate on some other things.
 

d_s_ramesh

Well-Known Member
#36
It was great to know you are quite well versed not only in thinking but on thinking too. We believe you meet with great success trading.
 

d_s_ramesh

Well-Known Member
#37
52 Week high again strength???

NIFTY showed high strength towards close and has given a 52 Week high again. On the volume side, it is flat. Apart from Bank Nifty and Nifty Junior which has gained considerably other indices have stayed flat, while Nifty junior has taken a strong beating with a close to 12% fall in volume.

At a new 52 week high, NIFTY has managed to get the MACD Histogram above zero. But, this gives a very strong bearish divergence on both MACD Lines and MACD Histogram. With 8 continuous weeks of higher high closing, will this week too follow suit or will there be a retracement? It is a wait & watch scenario as of now.

The NIFTY has marched past its immediate resistance, closing just below 5370. The present resistance area is a band of 5370-5390. This zone is very crucial for NIFTY. Todays high on NIFTY has recorded bearish divergence of MACD Lines on the Daily charts too. So, long trades need more caution now.

TELECOM Sector bounced back with a vengeance today. BHARTI which was due for long exit below Thursdays low was not triggered. RCOM too was strong today. IDEA has gone into value zone activating buy. Buy above 65.25 or on after MACD Histogram uptick on daily.

All our stock calls of previous post have got triggered long. RALLIS has closed up and with it SUNDARAM FASTENERS too.

With the Hospitals Industry being the big loser today, there is opportunity for long trades in FORTIS, wait for previous low to be breached & then trade long.

Detergents Industry group registered highest gains today with an above 6% gain on the index. NIRMA, has registered a strong move up today, but charts do not favor buy signal at present.
 

d_s_ramesh

Well-Known Member
#38
NIFTY gains bullish strength

NIFTY gave a tight range lower close today, but volumes show good improvement. Many Indexes have registered double digit volume growth in comparison to previous session. Daily chart of NIFTY has gained further strength, as the Daily MACD turns bullish again. What does this tell? The uptrend is likely to continue for some more sessions.

Another value long trade on the hourly chart in the offing, while daily position remains intact. As weekly charts are still bearish, first weakness on the Daily chart should be used to exit longs. Though Weekly is bearish, there is no signal to go short now. On weakness NIFTY is likely to find support at 5265-5185 levels. The Value zone has got widened considerably.

After the retraction, trade long on uptick. Target exits are advisable on NIFTY, as there is inherent weakness getting built up in the longer time-frames. Once 5390 gets cleared decisively, there is all likeliness of NIFTY reaching 5550 levels. This needs great strength on next moves.

CONSUMER Services sector performed strong today, it was pulled up by Hotels and Retail Industry groups. Both these industry groups are retracing bearish divergence on weekly charts, while the current uptrend is not yet complete. Chances of trading long here is restricted.

TECHNOLOGY Sector was the weakest, it also showed in volumes. The only Index in the NSE stable to register lower volumes today. On the NIFTY taking a U turn, the leader to drag it down will be TECHNOLOGY sector. All long trades in this sector and Industry group may be tightened and kept on close watch for suitable exits.

HEALTHCARE Sector followed at 2nd lowest. There are opportunities to be looked at in this sector. CADILA, APOLLO HOSPITALS, FORTIS and SUNPHARMA all look great. Put them in your watch list & have close scrutiny for a long entry.

Shipping Industry group was the out performer today with an above 4% gains on its index. ESSAR SHIPPING being the star performer with an above 12% gains today.

All our recommended open long position have favored well today. BHARTI has regained bullish strength and is now a pullback buy candidate.
 

prasham

Active Member
#39
Re: NIFTY gains bullish strength

On weakness NIFTY is likely to find support at 5265-5185 levels. The Value zone has got widened considerably.
Before the above mentioned levels I think 5330-5325 levels also should provide strong support to the Nifty....

:clap: Before you take my point seriously read my disclaimer below :clap:
 

d_s_ramesh

Well-Known Member
#40
That is the level to go long on hourly chart. Targets as per today's reading is 5400. It would be a small profit, but a high probability trade.

Great! you have really done a wonderful job. The levels which we gave or for an opportunity in daily charts.
 
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