Well we had some sort of a capitulation day on Friday and its not over...Probably far from it...I was expecting a bottom to form above 4000 without too much price damage however looking at overall scenario now, it does not look like it...We might see 3600/3400 which was the 2nd alternative I was looking at...Expect lots of panic next few days as noises emerge from different areas..However this is not the end of the world and use the opportunities to pick up the good scrips you like - after a few days - no need for rushing in....Supports will be there at 4000, 3800 and 3600...If we see 3600, blindly start buying...We might see this sometime in July or August...
I was expecting a rally into end of the year..Probably will take more time and more price damage before this happens...We have a bradley turn date in September so it may take till then for all the bottoming action to get over...THE bottom might however form before that....
If A=C, bottom = 3400 area....3600 also likely. Lets see.
Update on my positions: As I posted before I scaled into a 50% long posn in cash last week...Turned out to be too early...However since I am heavily hedged in July Puts, I am not going to lose anything...Probably gain more....Need to trade what I see...At this point, all I can see is there is more pain coming...But it should be viewed as an opportunity.
I will post if I see something significant developing...
Best.
Saturday, June 21, 2008
Wednesday, June 18, 2008
Positive Divergence setting up on Daily!
Comments on chart...And comments welcome from all.
Last time this happened, we rallied 800 pts on Nifty...I did post on some forums that time also since I did not have this blog..Will history repeat? :-) Let us C...
Best to be cautious but remember its also very easy to be bearish..I am also torn apart in confusion even though bullish for now...
The other thing worth of noting is that internals are improving..A/D ratio etc improving..
Dont have charts to put up for this but working on developing something.
Best.
Tuesday, June 17, 2008
EWI Free Update on Asian Markets - India Included
Heres the link to the EWI FREE update on the asian markets..Including India...
https://www.yousendit.com/transfer.php?action=download&ufid=75BFA3316A4E2616
Now some notes here...They are bullish...they are seeing the 5th wave coming up into the end of this year and seeing new highs coming up..Maybe....I think...My views differ as you can see from previous posts...I think we see an X wave going up to highs later this year but probably not exceeding all time highs...After this X wave, the bear should resume..this is what I think at this point...Let us C... :)
Either way there is a lot of pain left to come in 2009 and 2010..I would recommend positioning yourself for this soon...lets be vigilant and nimble...This is a must in this current environment!
Best
https://www.yousendit.com/transfer.php?action=download&ufid=75BFA3316A4E2616
Now some notes here...They are bullish...they are seeing the 5th wave coming up into the end of this year and seeing new highs coming up..Maybe....I think...My views differ as you can see from previous posts...I think we see an X wave going up to highs later this year but probably not exceeding all time highs...After this X wave, the bear should resume..this is what I think at this point...Let us C... :)
Either way there is a lot of pain left to come in 2009 and 2010..I would recommend positioning yourself for this soon...lets be vigilant and nimble...This is a must in this current environment!
Best
Update - June 17th 2008
So the bounce continues...I scaled into 50% longs in few nifty August 5000 calls(just for speculation) and also all of the stocks mentioned in below post...Since I am still expecting a pullback the extent of which we cannot be sure of at this instant, also took some PUTS to
hedge the stocks for July...So thats how I am positioned now...
Expecting pullback shortly...might try a bit more higher before that...Many folks are planning to short at 4800 area...Well and good...However do not get too trapped in this view...Could be a bear trap...So be quick whatever you do...
I have noted, that operators get public bulled up and screw them...Then get them beared up and again screw them...DONT go with the flow...Stand out from the crowd!!...Be nimble and quick whatever you do...Thats all I have to say.
On a side note:
Heres a good read on the Martin Armstrong Model...Pay attention..This guy is a genius. (note that this is not a model for the market but rather a model on the economic/business cycle..so markets may not follow the timeframes explicitly..however I do see a good relationship between the 2)...The 8(8.6) yr cycle that Vivek Patel favours is clearly visible
here...
http://hubpages.com/hub/Martin_Armstrong_Business_Cycle_Model
My thought is that we are in a 2-3 year bear market...This does not mean that we will NOT have fast and furious rallies in between with the bottom pickers and the short covering...But overall I think we drift down into late 2010 and early 2011...Now these are not numbers I just pulled out of my hat...this is based on the Martin Armstrong economic model(google this to find out more)...And from what I see...I think we will rally(X wave) from around here to maybe september/october timeframe in time for the US elections and turn down very hard from there...into 2009...
Ofcourse this is all speculation only...
Best.
hedge the stocks for July...So thats how I am positioned now...
Expecting pullback shortly...might try a bit more higher before that...Many folks are planning to short at 4800 area...Well and good...However do not get too trapped in this view...Could be a bear trap...So be quick whatever you do...
I have noted, that operators get public bulled up and screw them...Then get them beared up and again screw them...DONT go with the flow...Stand out from the crowd!!...Be nimble and quick whatever you do...Thats all I have to say.
On a side note:
Heres a good read on the Martin Armstrong Model...Pay attention..This guy is a genius. (note that this is not a model for the market but rather a model on the economic/business cycle..so markets may not follow the timeframes explicitly..however I do see a good relationship between the 2)...The 8(8.6) yr cycle that Vivek Patel favours is clearly visible
here...
http://hubpages.com/hub/Martin_Armstrong_Business_Cycle_Model
My thought is that we are in a 2-3 year bear market...This does not mean that we will NOT have fast and furious rallies in between with the bottom pickers and the short covering...But overall I think we drift down into late 2010 and early 2011...Now these are not numbers I just pulled out of my hat...this is based on the Martin Armstrong economic model(google this to find out more)...And from what I see...I think we will rally(X wave) from around here to maybe september/october timeframe in time for the US elections and turn down very hard from there...into 2009...
Ofcourse this is all speculation only...
Best.
Monday, June 16, 2008
Some more picks!
Some more picks...I am thinking of slowly accumulating these over next 2 weeks...As I said before we are at or very close to an intermediate bottom. Please note this is all for CASH ONLY...No FNO...And timeframe I am thinking till end of this year...For now.
Comments are on the chart...
If you can think of any other good picks, please add in comments on this post.
Best.
Comments are on the chart...
If you can think of any other good picks, please add in comments on this post.
Best.
Heres a gem that should not be missed!
After the big IPO hype, here is one stock that we havent heard much about...MINDTREE...See how its consolidating nicely after a small and quick run up...Looks like a bullish flag to me...Buy when it breaks out OR start buying in small amounts right now itself...play with stops with a close below channel indicated above...Please note that this is a longer term play...so only cash...no fno.This one could turn out to be a real GEM in coming days/months...Remember you heard this one here first!
Best.
The Doomsday Channel..Or is it?
Heres the channel of 'doom' that has been playing around for the past few months...This here shows the lines that our market needs to get above to confirm bullishness....Till then chop chop and maybe a good opportunity to pick up some good scrips...I said yesterday...we can get to 4620 and pull back from there...been there done that...now what next?....Maybe we pull back to 4520 area and try once more 4620...above 4620, we can rush to 4700 area and then again pull back...
Honestly I would love to see 4300/4250 so I can load up on bullish positions...But we might not get it...Maybe we only get 4450/4400...But lets not jump ahead of ourselves and see how it plays out...I see market moves as part of a big puzzle...And one by one the pieces should fit into place...!...Its key to be patient..!
Best.
Sunday, June 15, 2008
Market Thoughts - June 16th
Lets face it...Friday was a stalemate b/w the bulls and the bears...Very volatile in a range...Bears continually tried to push down the prices but when there is a such a huge short interest open in the market and majority is bearish, the market will behave like a beachball...No matter how hard you try to push it down, it bounces right back up...!
Coming to this week...As was said last week, the market should try to stage a bounceback to 4620 area first and above that if sustained, we should get to the 4700/4750 area...Well the market held so far...We might be able to see 4600 and 4620 today or some short covering and new buying interest coming into the market. I am not sure if we will sustain above 4620 .. But let us see...From one of these areas, we can open a new wave down...
Earlier I was expecting that we might open a really big 5 down maybe to 4000 or even 3600...But at this point, looking at momentum and other factors, I think max pain might be over or very close to over...Best case for the market right now is for us to touch 4620, sell off from there, and retest the lows. Lets see if this turns out...On the retest, if we hold 4400/4350 or even slightly lower at lets say 4300/4250 area, I think we might be at a very important intermediate bottom. Maybe even the bottom for the year....
In other words, we should look to set up longer term portfolios over next 2-3 weeks is what my gut feel is saying...However I am looking toward market moves over next 2 weeks to confirm my ideas so that I can make a more confident decision.
We are not out of the woods yet but some encouraging signals are there...
Okay here is the hourly chart attached above...You can see what I was talking about in the above writeup...Lets see if it holds...We can set a higher low, double bottom or even a slightly lower low with divergence in indicators - This is what we should watch out for in coming 2 weeks.
Heres the daily now...Same idea even though a very optimistic move is shown here...If the bottom gets confirmed as explained above, expect the above scenario unfolding toward end of the year.
Heres the weekly...Just posting this here to show some caution...See stochastics here...still no indication for a longer term buy...In older posts, I have pointed out how, stochastics and macd crossovers on the weekly generally give very strong long term buy signals...
Coming to this week...As was said last week, the market should try to stage a bounceback to 4620 area first and above that if sustained, we should get to the 4700/4750 area...Well the market held so far...We might be able to see 4600 and 4620 today or some short covering and new buying interest coming into the market. I am not sure if we will sustain above 4620 .. But let us see...From one of these areas, we can open a new wave down...
Earlier I was expecting that we might open a really big 5 down maybe to 4000 or even 3600...But at this point, looking at momentum and other factors, I think max pain might be over or very close to over...Best case for the market right now is for us to touch 4620, sell off from there, and retest the lows. Lets see if this turns out...On the retest, if we hold 4400/4350 or even slightly lower at lets say 4300/4250 area, I think we might be at a very important intermediate bottom. Maybe even the bottom for the year....
In other words, we should look to set up longer term portfolios over next 2-3 weeks is what my gut feel is saying...However I am looking toward market moves over next 2 weeks to confirm my ideas so that I can make a more confident decision.
We are not out of the woods yet but some encouraging signals are there...
Okay here is the hourly chart attached above...You can see what I was talking about in the above writeup...Lets see if it holds...We can set a higher low, double bottom or even a slightly lower low with divergence in indicators - This is what we should watch out for in coming 2 weeks.
Heres the daily now...Same idea even though a very optimistic move is shown here...If the bottom gets confirmed as explained above, expect the above scenario unfolding toward end of the year.
Heres the weekly...Just posting this here to show some caution...See stochastics here...still no indication for a longer term buy...In older posts, I have pointed out how, stochastics and macd crossovers on the weekly generally give very strong long term buy signals...
Nothing yet on this chart...However if stochastics does turn up, we can get a weekly divergence which will be a very strong buy signal for longer term.
Heres the very long term chart...
Now before I said we can go for 3600 as a worst case...However after further analysis this weekend, I think we might not get so far....There is good buying support coming in a lower levels...
Heres the very long term chart...
As posted before...
Of the major bull run that lasted more than 6 years...
Start at 850 Nifty...End at 6350
Nifty.38.2% retracement is 4333
50% is 3667
61.8% is 3002
Now before I said we can go for 3600 as a worst case...However after further analysis this weekend, I think we might not get so far....There is good buying support coming in a lower levels...
And also we have hit very close to the 38.2% retracement...Maybe this is all!
Forever optimistic! ;)
Okay now some speculation here...
Lets say we do set an intermediate term bottom and turn up strongly from here, I do not see the possibility of this being a new bull wave...However it would be just an X wave running maybe till the end of this year..and maybe running very close to all time highs on nifty....After which the next ABC should start target lower lows or maybe even a very long term double bottom...But this is just speculation so lets burn that bridge when we get there ;)
Dont jump in and buy yet...lets wait for some more evidence...Will definitely post here when I buy stocks and which ones am buying...some stocks that look good for me are rpl, reliance, panacea, l&t and some others...Will post a more comprehensive list when I do start buying for longer term....
Dont jump in and buy yet...lets wait for some more evidence...Will definitely post here when I buy stocks and which ones am buying...some stocks that look good for me are rpl, reliance, panacea, l&t and some others...Will post a more comprehensive list when I do start buying for longer term....
Have a good trading day!
Best.
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