Sridhar's Trading Dairy

[sridhga]

Yesterday, since rupee depreciated against the dollar, IT stocks shot up including Elxsi. So much of intraday buying happened. However all of them sold off at in the last 45 minutes. I went short. I was in loss for much of the day. But in the closing hour, I was in a meeting and could not check the trades. All these long position players were intra-day traders and they exited in a rush to bring down the price and my Bracket orders exited in profit.

For tracking these hyper sensitive tech-stocks one should keep these under-currents in mind.

However, after intraday traders exited, Elxsi inched up indicating some strength. (Or was it BTST buying?)

Note: Rupee depreciation hit banks adversly. Moreover global markets and Indian indices were trading in deep red.

 

[sridhga]

BEL was trading in the negative for the last 2 trading sessions. No strong buying was noticed yesterday and it was incessant selling. I did not understand this. Were global factors the reason? Did the Govt start offloading as stated earlier? Do they really off-load in open markets? Don't they auction or something? I really do not know.

But it appears to be long-unwinding. Volumes are coming down to its pre-result, pre-news averages. Also we can observe reduction in Futures OI.

Will observe this further. I do not know much, but something in me tells that it will not breach 115 and may bounce up.

 

[timepass]

BEL was trading in the negative for the last 2 trading sessions. No strong buying was noticed yesterday and it was incessant selling. I did not understand this. Were global factors the reason? Did the Govt start offloading as stated earlier? Do they really off-load in open markets? Don't they auction or something? I really do not know.

But it appears to be long-unwinding. Volumes are coming down to its pre-result, pre-news averages. Also we can observe reduction in Futures OI.

Will observe this further. I do not know much, but something in me tells that it will not breach 115 and may bounce up.

Maybe it is also related to the dollar movement.

 

[sridhga]

On BEL today, I was wrong and right. It did breach 115 but bounced back and closed above 115. I believe a short term uptrend started. From 3 pm massive short covering started and the share bounced up. It was in the positive territory even much earlier. I was tempted to trade for Re. 1 profit per share on the futures lot while it was recovering from the negative territory. Had I taken such a trade, it could have given me the desired profit, but I did not dare to do it.

 

[sridhga]

Today, I went short on Elxsi, then went long and then again went short. Made some profit on every trade. That resulted in a small profit for the day. I am happy because, I seem to be getting a hang on Elxsi, finally.

Product---Instrument-----> P&L
BO---TATAELXSI18AUGFUT---> +7560
Less Trans. Charges: ------------> -600
Balance: -----------------------> +6960



Fill time----Type----Instrument----Qty.----Avg. Price
14/08/2018 14:27----BUY----TATAELXSI18AUGFUT----800---- 1440
14/08/2018 12:22----SELL----TATAELXSI18AUGFUT----800---- 1446
14/08/2018 10:11----SELL----TATAELXSI18AUGFUT----800---- 1426.5
14/08/2018 10:09----BUY----TATAELXSI18AUGFUT----800---- 1424.4
14/08/2018 9:38----BUY----TATAELXSI18AUGFUT----800---- 1415
14/08/2018 9:27----SELL----TATAELXSI18AUGFUT----800---- 1416.35

 

[arunkarthik]

On BEL today, I was wrong and right. It did breach 115 but bounced back and closed above 115. I believe a short term uptrend started. From 3 pm massive short covering started and the share bounced up. It was in the positive territory even much earlier. I was tempted to trade for Re. 1 profit per share on the futures lot while it was recovering from the negative territory. Had I taken such a trade, it could have given me the desired profit, but I did not dare to do it.

I would need to muster enough courage to venture into futures. Though I have a huge exposure in options for all expiries, futures has always frightened me.


Cheers
AK

 

[sridhga]

On August 14th, around 10 lakh shares of BEL were bought in just the last 30 minutes. They appear to be professional traders with very large funds. During morning, as the share was sliding, these investors let the share slide as much as it could. Then, post lunch they started acquiring little by little and, in just last half hour, they bought in huge tranches. Why did they do like that? They figured out that, as the shares were sliding, shorters were active on the counter. They let shorters bring down the price for their benefit. Now, as afternoon progressed, they started acquiring little by little. As we reached the last hour, shorters had to exit for the day as they could not take risk due to holiday on the following day. That resulted in short covering. That explains why Futures OI reduced. Also notice that Puts OI reduced as the entire market realised that short covering was happening and the share is going up. These large investors further bought in large quantities in the last half hour. This gave them double advantage. One is that their early afternoon acquisition appreciated. And large buying in the last half hour can prop up the price without providing time for reversion to mean for the day. Moreover, since the following day is a holiday, lot of water would flow under the bridge to change the sentiment.

The above argument explains why 115 was not breached by the end of the day. It also further explains how difficult it is for small traders to work along with and compete with large money bags. It also explains why there are Friday reversals in most stocks.

However, it is difficult to play these games in widely held stocks like tech stocks where there are many such money bags working with different time frames, with different views, and, different motives.


My strong guess is that today (16th August) BEL will roar into the green. Will I trade BEL today? Maybe!

 

[arunkarthik]

On August 14th, around 10 lakh shares of BEL were bought in just the last 30 minutes. They appear to be professional traders with very large funds. During morning, as the shares were sliding, these invsetors let the share slide as much as it could. Then, post lunch they started acquiring little by little and in just last half hour, they bought in huge tranches. Why did they do like that? They figured out that as the shares were sliding, shorters were active on the counter. They let shorters bring down the price for their benefit. Now as afternoon progressed they started acquiring little by little. As we reached the last hour, shorters had to exit for the day as they could not take risk due to holiday on the following day. That resulted in short covering. That explains why Futures OI reduced. Also notice that Puts OI reduced as the entire market realised that short covering was happening and the share is going up. These large investors further bought in large quantities in the last half hour. This gave them double advantage. One is that their early afternoon acquisition appreciated. And large buying in the last half hour can prop up the price without providing time for reversion to mean for the day. Moreover, since the following day is a holiday, lot of water would flow under the bridge to change the sentiment.

The above argument explains why 115 was not breached by the end of the day. It also further explains hot difficult it is for small traders to work along with and compete with large money bags. It also explains why there are friday reversals in most stocks.

However, it is difficult to play these games in widely held stocks like tech stocks where there are many such money bags working with different time frames, with different views, and, different motives.


My strong guess is that today (16th August) BEL will roar into the green. Will I trade BEL today? Maybe!

The world indices are in deep red, in not sure about BEL being in green unless out markets show extreme resilience.


Cheers
AK

 

[sridhga]

The world indices are in deep red, in not sure about BEL being in green unless out markets show extreme resilience.


Cheers
AK

You may be right. You have offered a counter perspective. I gave my views based on BEL price action. Will BEL succumb to global pressures? Will it stand up on its own? Let us see when the markets open. Anyways, I may not trade in opening hours. I will observe the opening. Thank you for your inputs. Some days earlier, I posted some data indicating that about half of the time BEL was not going with the market. Let us wait and watch.

 

[sridhga]

Okay today initially BEL took a dip. But, while it was coming back quickly took two lots to make a quick small profit.