Chill Out!

Another attempt...This time Bryan Adam's 'Back to you'

Comments appreciated.

One More Thought - EDIT*

EDIT: Sorry I had to delete earlier post and repost here...One idiota loser who probably has not even made a single cent in the market in his life has started posting anonymous comments that I will soon fail and commit suicide...LOLZ. I feel for you my friend - I think you have lost a lot in this bear and are just venting your frustration out...I guess you are also the same guy who commented a while back that 2250 is not the short term bottom but it would be 1860...Hows that working out for you?

Sorry could not resist...

I have changed settings...No more anonymous comments...

So that the latest post and comments do not get lost, I have pasted them below.

Latest read on markets - Well I dont know...I am still seeing possibility of a big down day...Or even cumulative down...Either way I have to start seeing sub 2700 in next 2-3 days. Else have to start thinning down on shorts....Already I managed a few, took profits on some and so on....But probably will think about really cutting them down soon.

Cheers.


OLDER POST AND COMMENTS
=======================
I have a pretty good feeling that we can have a very big down day today or on Friday. Be very careful out there if you are trying to bottom pick. For the down day to trigger, 2750 should break first..Then 2700. If so, then I think the goose is cooked and we head to 2525 first stop.

I will put up a new analysis video over the weekend.

Cheers!


COMMENTS
========

Yoda said...
Something about this fall isn't right. Can't put my finger on it.

Most stocks by this point are uniformly poised to drop - that syncing hasn't happened yet.

I'd advice caution since yesterday's fall was so controlled.

February 4, 2009 6:36 PM


Lee said...
Yoda, I agree with you to some extent...Something is not in sync...I can feel it also...Which is why if you see my last 2 posts, I am advocating lots of caution in case the whole premise is wrong...lol...I cant put a finger on it either but STILL...I have to play the odds...And short still seems the way to go...If we dont drop in next 3-4 days, I have to rethink this whole fractal...

Cheers

Thoughts

Hope you all enjoyed the video in the post before...The quality in the video posted in the post was really bad which is why I uploaded the video in full quality. If you download those, you will be able to see it in full resolution. The blog embedded one sucks...

If anyone has a more effective solution on how to put the video IN the post itself, I would really appreciate it...Suggestions welcome.

Some folks had problems with actually playing the downloaded file. If you are having problems...Go to this link -
http://www.videolan.org/vlc/download-windows.html

Download VLC media player...Superb player and will play pretty much every video file under the sun..Few it will not but thats fine...

Do this, and I am sure your problems with actually playing the file will be solved...

Regd the earlier posted poll, majority was bearish..But I think this is because you guys are reading my views and are influenced by it. Mainstream as I see is not so bearish...Sure there are bears but there seem to be a lot of baby bulls. Scary.
The other thing I feel is this...We are probably in the terminal end of this decline phase..So this means lots of people are bearish...But still the decline will come to wipe out the last smidge of bullishness so that the new baby bull market can start.
This is my feeling and interpretation. I can be wrong also. :)

Okay now coming to the markets...

So far, the market has been driving both bulls and bears crazy...Rangebound moves...And very volatile both ways and taking out both bulls and bears. I expect we will continue to be in a wide range of maybe 2500-2900 for atleast few more weeks...And the interesting part is we might test BOTH ends of THIS RANGE very soon. Get ready for some fireworks! :)

Be careful though playing in these conditions. What we have in some serious volatility compression...And we are building cause for a move in a certain direction. I am still looking for down as per my fractal map but still will be playing things cautiously...For example day before, I got out of some of my puts which I will likely enter today...Only thing I am not sure is whether to go for Reliance or Nifty but will see...Either case, I believe in next 4-5 days we have to start the big move down...2525-2600 first stop.

Charts and Commentary below -

NIFTY


RELIANCE


SENSEX


Okay...now something important...Even though I am raving bearish here and I am sure many of my readers are...Its important to play safe...We never know what can happen in these environments..SO...Play Safe!

Best.

Market Analysis and Views - New medium :)

Video I made with my latest analysis...Just trying something new. Enjoy...and comments welcome!

EDIT: Sorry guys I know the quality is bad..But I tried so many things and couldnt fix it...most free services do not maintain that quality of the initial file...So I am putting links for the direct files...Anyone who does not like the quality below, can download the files...Split into 2...

PART 1

PART 2

Poll..Please VOTE based on what you think..But also dont miss important post below!

Market Outlook Do you think market has bottomed or where do you think market will bottom? Bottom is in...BIG rally comin! Maybe little down but bottom is in or very close to in..I am buying dips No way..I am selling rallies big time!!! In trading range for long time Markets? I dont give a damn! View Result free web polls

pay sites

The Setup

Those who dont know about fractals or if you missed my earlier call on the same, please go and read the fractal call I made in September before the big plunge -> GO

Okay now coming to situation now...I have posted the chart with the fractal outline below. Its self explanatory and it should be fairly easy to see if the moves are playing out as forecasted. Till date I was looking at the fractal but still the moves were not clear enough but with recent price action, I think we are close. 

 

The other thing I find worth to mention here is when we hit the recent bottom last week, I would have covered but I was looking for lower since the fractal suggested the same...Unfortunately market always acts the way that is least expected. So shorts are now squeezed and retail and TV analysts seem to have gotten bullish again. I think we are very close to another short term top right here. I will be watching today's and tomorrow's action closely.

The Bottom Line - Until we go above 3150, I will remain bearish.

Best.

Amateur Guitar!

:-) 

Here is a song by Green Day...Good Riddance...Played by Moi...

I am a beginner so bear with me!

Comments welcome.

Best.

Introspection

When I started this performance and trade tracking business a couple of weeks back, I said it was going to be more of an experiment than anything else...And I also mentioned my intentions with this...i.e...not to start any kind of stupid trading calls service...But instead to serve as a performance tracker in case I do eventually get to do my dream job - be a fund manager.

Now after 2 weeks in this, I have to say, this thing is affecting my judgement, leading to unwanted stress and overall is hampering my performance. I say this comparing recent performance to that from a few months back. I think more than anything ego and stress is coming into play and these are things that should be avoided for sure in trading...

I know of several people who did something similar to this over here in the US..And I saw similar things happen to them also...They were outstanding at first but then just tapered off as more people began to follow them...Granted its too early to say for sure for me...But I think it is wise for me as a trader to make a call to shut this thing down.

I have had this nagging thought in the back of my mind for long...I have also thought about this for a long time yesterday and today....And have made my decision.

Trade sheet is updated with all the latest...I will leave this here for a day before taking it down.

Overall since I started, booked shows 11% and unbooked+booked will show around 6% profit.

For records purpose, let it be 6% and assume that all positions are closed and I am flat when I take this down.

I am sorry guys...to those who liked this new thing....but I have to think of my trades, my performance...and in the end, if my performance is getting affected, then what is the point?

Regd the market, I still think we are in a topping process and retail seems to be bulled up again...I think all rallies should be shorted from now on...FWIW.

Best.

More Adjustments

Okay here is what I did...Closed 3000 Calls(hedge) at approx 50.5

Entered 2900 Calls(as a hedge) size 2000 at approx 85...

Enter 2700 Puts size 1000 at approx 98...

As always all updated in sheet above..I saw some Qs asking about the trades..I dont see what is

so difficult to understand here..Whatever trades I take goes to 'open' and whatever I close, goes to 'closed'...Whats so difficult to understand? Comeon guys do some research on your own.

I know I know..Their is a good chance this trade will be a loser eventually..But as always I have to play the odds...I have to play my system and my gut feel..

Best.

20/20

No not a cricket match :) ... I am talking about hindsight here...Its funny how that works...Hindsight is always 20/20...What does that mean? It means looking back, we always know the exact points in time where we should have done something...And looking back now, I realize I should have covered shorts and probably sat out this current upmove.

Some of you readers might think I am a fool for letting this profit go by...But again the hindsight thing comes into mind...

I do not have much concern over here as I think this is just an oversold bounce in a very badly damaged market. In the bigger scheme of things, its not a big deal. I know I was in decent profits last Friday and after today's close overall position is in a small loss...I admit this is psychologically draining to see what was a profit go into a loss...But I follow the Jesse Livermore maxim...Sometimes in a trade, you just have to sit tight and wait for the BIG ONE...And that is what I am waiting for here...Might have to take some more pain but the payoff could be big.

The other thing I am feeling now is...after starting this new position updates thing on the blog, it has increased the pressure on me several times over...The pressure to not get into bad trades...The pressure to keep on winning...I guess this is why almost no one will do something like this...I am however going to tough it out and see how it goes...If I feel my performance is getting impacted, I will decide to stop the same...After all that is more important to me. Right now its quite too early to say for sure...But I am keeping a close eye on it.

Coming to the markets...Ok we got a good rally...Next area is 2805-2860 resistance bundle or wall...It would be very tough for the market to go over this...But if it does, we will challenge 2920-2950 range....As of now I dont have a clear plan on this trade if this happens...But I will see when we get there...Break 2720 on the downside and I think the downmove will continue in earnest to 2500 odd. Right now its a toss up and cant say for sure what the short term move will be...Intermediate term..i.e over next 2-3 months, I am very confident we shall see 2200 area and lower again. In the meantime, some pain is bound to be there.

If I get some time later, I will post charts with the counts I think we are in now.

Comments welcome.

Best.

Took OFF some of the Hedge

Just repositioning...You can see the details above.

Best.

Weekly Update - Chop Chop

My thoughts for the week...It will be short as there is nothing much to report. Expect the chop to continue...I think we shall get a good chance to cover shorts someday this week. Based on global markets, it looks like we bounce today...Shorting at around 2860 might be a good strategy.

See below chart...red and blue lines show possibilities short term. I think we are still finishing off wave 4 before wave 5 opens down.

Very simply speaking, we should see 2525-2550 area first (after going up today)...Then we should see around 2860-2960 range....Then the final move down. I will post these counts later...

For today I might do nothing in my trades...Short term taking some pain but we will see how it plays out.

Best.

10000 Hours

Funny title? Well that is the amount of time it takes anyone to become a master in any particular thing...Be it trading....or be it singing..or be it playing the guitar...Thats what it takes to be an expert in any field.

I read a blog article a few days back and cant find a link anymore but basically what it says is...For anyone to become a master in something, he or she needs to spend 10000hrs in that particular thing...

So lets look at trading...lets say you spend on average 5 hrs a day....so it will take you approximately 2000 days or 6-8 years to become a professional...This is assuming ofcourse you are fully dedicated and do spend 5 hrs a day...

Now statistics say that out of all traders maybe only 3-5% at a best guesstimate actually make profits consistently and over the long run...Why? Because most people give up after a year or 2...They either get frustrated or disillusioned or the market kicks them out...the great bear market of 2008 would have done that to a lot of people...If you remember, I once wrote about this...How I started out with few of my friends in this business and in the end only I am left...Not that I am very successful..Only that I do realize that I need to put in effort and lots of effort...I realize there is no free lunch...And we need to work for it..Now more than ever..Which is why I find it laughable that people tune in for tips and free calls...

I occasionally dab a little bit in guitar and music...Maybe I would have spent around 1000 hrs on and off...I can play a bit but I got fed up in between and stopped...Now I started this up again...I think I shall persist this time until I can play good enough...Maybe I will post some of my songs here some day..But my point again is that NO PAIN...NO GAIN...

Do your due diligence folks...Work toward those 10000 hrs...

Will post some thoughts for the week a little later.

Best.

Adding some more

Adding a little bit more...Now I am in full position...

500 NF added at 2685

2000 NF full position avg of 2777

EDIT: Setup I am watching says there is a good chance we break the 2680 support and start a waterfall decline....We can tag lower support area of 2540-2600 range and start an upward rally from there :) 

However its all speculation and usual disclaimers apply...we shall see how it turns out..I am remaining short for now.

Best.

Status Quo

After watching the tape for the past 1hr or so, I am making a decision here not to do anything on the positions. I still think we shall bounce but still there are times when a trader has to make a decision on a position on whether to take profits on a position or let it run in the hope of getting a bigger profit...In other words letting profits run...Ofcourse downside here is that a decent profit can turn to a small profit..or worse a small loss...But thats the game....

If you are a risk averse trader, take profits now and try to reshort higher...I remain short for now.

If we go higher over next few days, I will increase short allocation and reduce the calls allocation.

We shall see. As always its a game of odds and I need to trust my instincts.

Best.

Possibilities Possibilities....

So US market finally makes a spectacular rally from a very oversold condition. In the bigger scheme of things, I see this as a bounce or short term rally....short covering rally or scorch...as I call them...So what happens to us?

I think we shall maybe whip around a bit today, form a base and also do a rally attempt for next few days. 

So whats my plan? Likely I will cover today at best prices I can get...And go flat...Not going long for this swing...My mind is saying not to... :) Let it rally...I shall short higher if situation is right.

A Note here - A warning to all late to the party bears - be careful...scorches like what we had here in US markets can happen in India too...I saw comments and questions on late shorts..let me say...timing is damn important...My thought process and entry points are all chronicled in this blog on a real time basis...Please dont ask me for more information on trades or when you can take trades etc etc...I am not an advisor...I dont want that on my head...If you simply follow my trades, thats up to you...However I am sorry...I cannot and will not offer any person specific advice on trading positions..(let me give an example - lee, can i short at 2720....or lee, i shorted at 2700 level, when should i cover...)..It is just too stressful and dangerous for me to offer any advice of this kind and I will not do so...If you see my position and deem it wise to do something, then go ahead...You are on your own...Sorry to be harsh...But I have to say this before things get out of hand.

However - If you need any help on technicals, fundamentals or anything else related to the market( or anything else! :) ), let me know as always...I will be glad to help as I have been helping others over past weeks and months...

Cheers 

Adding....

...to shorts here...Feb NF 500 more at 2756

Hedge Options Feb 2900 Calls....1000 at 103

I am not very confident on this one...But trying it out...

Increasing hedge ratio, as bounce possibility is higher over next few days.

I will update the trade sheet above shortly.

Trade safe.

Cheers,

Lee

Tough Call

Tough call on the market direction next. I see different possibilities out there but lets take it one day at a time. See the reliance chart below with comments. You can see my thought process on this one.

Broader market...Well...2750 and then 2700 area remain most important on downside and 2860 on upside. There are so many other resistances on upside...it will be tough for market to move up...I want to see a wash out in the market but I am not seeing that...They still continue to buy the dips! Amazing is what I call it...Give up already...Well I just see more pain ahead but enough of my rant...Lets see how it plays out...There is a significant rally coming soon but from which level is the big big question? .. So well..lets just play it as we see it.

Trade update - My positions and latest prices are updated above as usual. Yesterday I had an urge to close and reshort higher...also to add more shorts at a higher level...but in the end just decided to maintain status quo. The reliance chart posted above should be studied closely. Its looks very important to me. 

Best

Lee

Zurich Axioms

Here is a link for another book I think every trader should read - GO

Its a fantastic book for any trader....Rules...Understanding risk etc...Enjoy!

I will post something on market views a little later.

Best,

Lee

Who were the Turtles?

In mid-1983 famous commodities trader Richard Dennis was having an ongoing dispute with his long-time friend Bill Eckhardt about whether great traders were born or made. Dennis believed that he could teach people to become great traders. Eckhardt thought genetics were the determining factor.

In order to settle the matter, Dennis suggested that they recruit and train some traders and give them actual accounts to trade to see which one of them was correct.

They took out a large ad advertising positions for trading apprentices in Barron's, the Wall Street Journal and the New York Times. The ad stated that after a brief training session, the trainees would be supplied with an account to trade.

This group was invited to Chicago and trained for two weeks at the end of December, 1983. They began trading small accounts at the beginning of January. After they proved themselves, Dennis funded most of the trainees with $1 million in February.

"The students were called the 'Turtles.' (Mr. Dennis, who says he had just returned from Asia when he started the program, explains that he described it to someone by saying, 'We are going to grow traders just like they grow turtles in Singapore.')" - Stanley W. Angrist, Wall Street Journal 09/05/1989

The Turtles became the most famous experiment in trading history because over the next four years, they earned an aggregate sum of over $100 million dollars.

Richard Dennis proved that with a simple set of rules, he could take people with little or no trading experience and make them excellent traders.

==================================================================================

To download and read this book go here - Link

Kpls 20day swing is a variation of the Turtles base system. Worth a study.

Best.