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Wednesday, September 14, 2011

2.5 Week low confirmed

No other way to read it now. Looks like we confirmed the 2.5 week low at around 4900 - This also came up in the timeframe I was expecting - Wednesday/Thursday. So its done now.

What next? We will likely rally for the next few days - until we get to a top for the 5 week cycle. And then again decline down into the 5 week low expected toward end of this month. Wild card is how high we can rally in this current bounce up. Will it be a double top? Will it stall in 5080 range? Will it get to 5175? Lot of questions but no way to know for sure. We have to observe market action for next few days.

Either way it looks like it would have prudent to atleast take off 50% of my shorts yesterday near 4900 - I was expecting the low - So could have definitely reduced the risk. Problems with having to trade at odd hours in the night. Well its done now. I have double hedges in place for the futures but the puts might lose some value today. So not quite sure how to handle. I might just close all and try scalping intraday until I see opportunity to put the shorts back on. Very fluid here right now - need to see how the trading day goes. Will update here.

Charts with a few more clues below -






EDITS:

1. Well I dont know. I expected a better performance today. Not to be. So it bounced but quickly went down. SO..Who knows. I think its better to go by levels..So 5040, above that 5150-5180. I think better to think about shorting in these areas. The Indian market is turning into a great deceiver nowadays lol. If world is up, India goes down and vice versa.
I covered lot of shorts initially..and then put them back on..so essentially still a status quo. I hate it..really hate it..but dont know what else to do. Lets see if this guy can trade above 5050. If it does, then I might cover some shorts. Right now looks damn weak. I will offer some more thoughts around this psychology tomorrow.

Best,
Lee

3 comments:

Sujatha said...

Hi,

Probably September is market friendly month for us (useless analysis) expect in bear market like 2008/03 like that?? hence hesitate to fall. secondly VIX in 30?? showing some "steadiness"??? babre..still both side possibilities open, yeah it's better to play the levels is good for 'wealth"

Sachin said...

markets take the best out of anyone Lee. :D D: D:D

I have positions both side.. will carry on with one once RBI decides whether its with bulls or bears.

andmj2005 said...

sir , by observing the similarity we may not even reach 5180 & gv sharp fall , is it ?