Hurst Cycles Trading Software - Accurately Forecast Nifty and Stock Cycles

Wednesday, September 28, 2011

Top in?

I really think so. For this particular move. There are various portions of evidence supporting it. I think unless we manage to get above the 5030-5050 range, I think it makes sense to sell all rallies. And cover on declines partially to reduce cost.
Today we should see sub 4900 for atleast some time. Whether we can stay there is the question. If we can, then below 4870, we can see more declines.
If we get to 4720 area this time, I do not think it will hold. We will slice through it and the next level to respect would be 4650. Still once step at a time. Its always easy to think oh we are going to 4650, 4200 etc or even 5500, 5700 and sit on a losing position. Take one day at a time.

OK enough of today's rant :)

Coming to markets, like I said, 4870 level is crucial. And above 5030-5050 level. In between kind of no mans land but still lot of opportunities to go in and out to get a better price on your positions. This is important. I mean if you are in profit, just book 1/3rd of position. Hold the rest. While this reduces your profit potential, it is a great psychological boost - to hold the rest of the position until target. And as it gets closer to target, cover one more 1/3rd. Then ride the rest of it. I cant tell you how much of a difference this makes!

OK thats it I promise :)

So I did cover a little yesterday..might just sit tight today or cover a little bit more..Reasons are as given above. Just balancing. Rallies will come to re-add back.

First the cycles chart -



Ok next a normal chart look. I have commented on the chart this time -



Another look. This is interesting. This is the Nifty Dollar Index - Defty - Are you able to spot whats interesting?



The DEFTY had already broken the lows corresponding to 4720 on Nifty. So basically the Nifty in Dollar terms is much more bearish that Nifty in Rupee terms. So what do you think FIIs are doing or will be doing? Think about it a little.

Ok thats it. Trade Safe!

If I do anything today, I will post. One thing I didnt post yesterday was that I reentered by NOV 4700 PUTS that I was trading with on the last big fall. I had sold them to buy back and I did that yesterday in preparation for the next leg down.

I also posted some comments in earlier post(s) - you may read them if you missed since I think some good info is there.

EDITS:

1. Not exactly sure what is going on. So stopping out of several of my shorts. Covered few in the morning like I mentioned I might. And rest at around 4936. Better be safe than sorry and live to fight another day. Unfortunately too much of news is coming out tomorrow..so another wild card. Probably around 40-50% short now. Above 5030 something else is happening so will likely stop out fully. Shall wait and watch.

2. Wow..that was some spike..toned down on shorts again..When in doubt better to stay out or reduce exposure..Maybe around 20% short only now. Will reevaluate tomorrow. Yeah I know I might regret this tomorrow..But still better safe than sorry.

3. Dont know. I am out fully. Hope the market does not crash tomorrow. Will reevaluate and come back. For now, bulls look very strong. Expiry sucks! :)



Best,
Lee

5 comments:

Anonymous said...

Dear Lee,

As usual ... Spot on ...

Nice to read your morning writeup before market opens.

Keep it up and have a good trading day ..

Regards,
Ganesh

Sujatha said...

But lee...

do you think 2morow may "super spike" to trap or today itself is the trap??

but risk reward showing to bear??

navin pujari said...

i guess wen i look at the
30 min MACD has given a positive divergence which tells me that tomorrow may be a positive day as well and the real fall will come in from 1st oct as its the 6th week starting from low of 4720 will wait n watch ....!

Lee said...

Who knows Sujatha..I am still bearish as hell..But need to respect price also..I will reenter back tomorrow. By covered most of them on an avg price of 4950, I save more than 70 points, so it was a good move. If market opens up, then will re-add the shorts back.

Expiry is always tough. Thats why I kept on reducing in the morning. I still wanted to hold some but was squeezed out. Not a big deal. Will get a chance to reenter.

Best,
Lee

Sachin said...
This comment has been removed by the author.