So back refreshed for another new week of battle :)
Last week was an excellent week for me as you can see from the posts. So it was a nice weekend off away from the market without having to worry about any open positions. And I think it was a good decision on my side - got almost low tick and almost the absolute bottom to cover the shorts. And maybe today we will get a rally to start re-initiating shorts.
I want to be clear on this. Re-initiate does not mean all in at once. I will go in small increments so as to reduce risk and also hedge a little so that if the market moves up some 100 points extra than what I expect, I will still be ok. OK - so the shorting range is around 4950+or-25 points - can use your own discretion. Also maybe hedge with 5000 calls. Will get rid of this as the situation arises - will post updates. Thats the plan for now. Still bearish for now. This will be just a dead cat bounce in my viewpoint. The 5 week low is expected in the October 1st week timeframe. So maybe around Oct 7th plus or minus a few days. Will tone down on bearish positions before that. But till then the downside pressure should be on. After that another dead cat bounce.
As I have preaching for some time, the 80week(4.5 and 9 year) nest of lows is going to come in November mid timeframe only. Till then its a bear only punctuated with bear rallies. If something changes in this view point which I think is unlikely, I will alert in advance.
Now price targets - I generally dont like to do this. Because it ties up our mind in one expectation. But still a wild guess for me would be around 4400/4500 for the 5 week low and lower that than for the major 80 week low. Still one day at the time. Dont want to go with targets. Will go with my timing model. If price also works out, then great.
Charts below. Just in a picture what I wrote about above.
So like I was saying the last major low at 4720 was likely a 10 week low(this software shows it as 20week but I think this is unlikely), and then the 2.5 week low came at 4911 on Sept 13th. So we are now 28days along the 10 week low and 10days along the 2.5week. The software is expecting the 5 week low around Oct14th(I think it will come in earlier because the 2.5week low came in early). Also the 80week low is showing as expected in last week of November(maybe might come earlier as I mentioned above but bit early to say right now). Just explaining so you can understand better what is shown in the chart. If you have questions, please shoot.
There are also some good comments in the previous 2 posts. You may read if interested.
Ok there were some questions on the Hurst material. I have mentioned before. Its not for the faint of heart and its expensive as well. But if you are really interested and really dedicated -
Alternatively, read what I write here and try to understand for yourself. There is another book that Hurst wrote initially - I will not recommend this one. Its confusing and Hurst wrote it when he just started developing this concept. The above link is best if you are interested and dedicated. Its not going to be easy.
Also here is the Jessie Livermore Audiobook I had promised. Download when you can. I will deactivate the link in few days -
Reminiscences of a Stock Operator - Edwin Lefevre.rar
One more thing - please refrain from asking me about your specific trades. I will not answer. I think I am providing more than enough thoughts and guidance here to be able to figure out for yourself what to do.
One question to readers - Whats the feedback on ZERODHA if anyone is using? Indiabulls is really eating into my profits because of brokerage. Really eating.
Okay - updates later during trading day. As I tried to explain above, my aim will be create shorts as much as possible toward the 5000 area. If we can get close enough.
1. Hope everyone shorted atleast partially at open..I just started a round(20%) at around 4872 NIFTY OCT FUTURES. Will add if we go higher. Also a small round of OCT PUTS 4800. Hedged with 4900 calls of current month.
2. Continuing to add as we go lower..boths PUTS and FUTS..I might go up to 75% allocation for now provided we do not break back above 4850 on spot. Looking very weak to be frank!
3. Trading trading, enjoying ;) Lots of shorts taken from 4870 down to 4840..now covered 50% at around 4765....Will add back as we go up..Keep trading to reduce cost..No longs at all for now..My view..just my view..you are always welcome to do hit and runs!...enjoy ;)