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Sunday, October 12, 2008

Market Thoughts for the Week

Well I posted to buy on Friday...I dont know how many bought in that panic with me...I see a very good possibility of an intense rally. I do not know if this is THE bottom - In answer to some of the comments and emails I got - BUT odds are we get a very strong rally maybe to 4140 area....Above 4140 and the bears will die big time...But one step at a time...The roadmap should be 3600 first...Evaluate there...Then 3800...Again evaluate...Then 4000-4100...Again reevaluate...Above 4140, and then we have something big on our hands...But as I said, one step at a time...I think we have had a washout...Capitulation...Still I see people calling for 2600, 2000, 1800, ZERO...lol...Well maybe we will get 2960 on this round but it looks unlikely to me...If we do get it, I will still be buying in cash...These opportunities do not come often...I will compare this crash we have just had to what happened when the commies came to power with the  Manmohan Singh government...God I wish I had the guts to buy at that time....Instead I sold...Everything I had...Now with the experience I have..And all the bearishness I see around, I think this is the time to buy. Maybe its just 3-4 months of rally...But still its a rally...Buy the dips is my advice...If you are risk averse throw in some PUTs to hedge your risk.

On the charts, I see that weekly stochastics is way down...An up week will probably turn it up and if so we will be on a longer term buy...

On EWI scale, we may have completed a BIG wave A down with a monster B wave rally to follow into the mid of next year before we have another major decline...

But now is the time to buy...I expect we will have a retest of the lows - But its not a big probability...I am lessening my futures trades and accumulating in cash...I bought heavily on Friday and today we will have a big gap up and then an attempt to fill the gap...I will watch this and probably buy the dip today afternoon...

All the best. These opportunities come once in a lifetime. I dont profess to be a trading god or anything..Others are there here like that...But I can recognize good odds when I see it.

Some good stocks - Infosys, Bhel, NTPC, SBI, Mosar Baer, KSOIL, LnT. Other welcome to add to the list..I am still digging for gems amongst the carnage.

Charts will follow later.

Trade Safe.

Best.

3 comments:

Abhimanyu said...
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Abhimanyu said...
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Abhimanyu said...

These opportunities do not come often...
That's it But .... the one who wants to invest has opportunities.

Traders dont bother about UPS n DOWNS

Last 3/4 months I am just on PUT n CALL option of ITC and I am making money around 7K to 10K profit every month.
This Month I made mistake and did play with IDBI but Still in profit
But with ITC I could have made more profit.
One must play with scrips that has more volume.
My trading had good support of your blog and Amibroker to decide exit.
for example IDBI PUT Strike 75
I sold at 11.50 which I bought at around 4 Rs.
IDBI went down down till 60-61 but the said PUT Did not go above 12.5. So My Profit booking at 11.50 was good enough.
Then I made average of IDBI CALL Strike 80 to 1.20Rs and today sold 2 lots @2.25 and 2.50 Rs
Still I am holding 2 lots which I will sell tomorrow.