Hurst Cycles Trading Software - Accurately Forecast Nifty and Stock Cycles

Wednesday, November 16, 2011

Bounce is on...For Now..

Well what can I say..been a tough few weeks in the market. This is the reason why I havent been posting much. I dont want to say something stupid and cause anyone else to make a mistake. I had suggested best thing to do maybe stay out until more clarity emerges. I am also really confused what is going on bigger picture wise.

Let me just try to think aloud here - We do know that some sort of major low was seen on Oct 4th at 4740 around. Lets assume this is the 80 week low for now. It was quite early but let us go with that for now. If we go with that assumption, then the 10 week low is due around Nov end/Dec beginning week. From there again, we can expect a decent rally. We should continue to decline into that low area. BUT for now however, yesterday, I think we saw some sort of very short term low below 5000 and we are doing the bounce up. For longs the obvious stop is yesterday's low.

Last 2 days, I got rid of most of my cash positions - the drawdown was not looking good on paper. But still its a small loss only because of the hedges. Overall I havent done so good last few weeks - so I decided to get rid of cash and go back to trading in Nifty. Since outlook is uncertain, I will be able to get in and out of positions. Also I am beginning to rethink on my longer term ideas. But I will keep that to myself for now and present them here when I have some more confirmation.

So long for now in NF..hope to get out around 5100-5150 area. From where again will try to build some short positions up into 5250 area.

Charts posted below.

Trade safe.



Aly said...


As I said in october itself, 4830 is almost here though i covered quite early (well I have already said I am a bad trader).

My guess is now the market may go on to make highs till dec end, sell-off in jan, again bounce back in feb and mar and then we see our 40 weeks low in apr may.

That is my prediction but need to be susbtantiated by what your cycles say? Is it safe to start going long here or do we see a much much lower bottom now only

Lee said...

Hi Aly, you were right..good work on that..yes trading is tough..I might not know I didnt mention it here...I was heavily short at 5300..then flip flopped and closed them...look where we are now.. :(

Thats the name of the game..

I meant to do a post today but got caught up in other stuff..I have some ideas - And I think it is playing out - I expected today to be the 2.5 week low and I think it is....So there is more downside..Or the next 2.5 week low should pass - this will also be the 5 and 10 week lows..So not a time to go long except for scalping..I am however long and will look to exit on Monday/Tuesday...Then start to build some shorts for the 10 week low - Nov30th-Dec5th timeframe expected for now. We see how low it goes. Its actually looking better now..I mean my expectations and what the market is doing...I think Oct 4th was some sort of anomaly. But lets go with the 80 week low for now.

I will do a detailed post on Sunday - Thanks to all who mailed me..I was not posting frequently due to the tough nature of the market..I think Kumar sir is doing a wonderful job on his blog - he is a veteran in the markets..Take his guidance :) I will continue to post my views regularly from next week as I think I am starting to figure out what is happening bigger picture.


Vipin said...

Hi lee,
Is there by any chance a case that the low which was expected in nov 1st week has got postponed and is yet to come and may come in dec 1st week.

What r the elliot wave count saying n what r alternate possibility?

Your guidance in such scenario is must becoz when there r uncertain scenario the experiance guides you through right path ....

Vipin Rathi

Lee said...

Vipin, yes also very much possible..This is the problem with major lows like the 80 week lows. So its uncertain. This is one reason why I was focussing more on the lower cycles like 5 and 10..

As I said, I will do a detailed post on Sunday which shows different possibilities along with my preferred view point. Elliot also I have an idea what is happening. I will include thoughts on this also. This is why I mentioned things seem to be jelling in right now..Elliot, Hurst and normal TA.