Year End ideas

The year gone by was a very good year in terms of market gain.

As the New Year is knocking at our door its time to go back and think about trading mistakes . Make a personal note of every trade and work out how you can improve further. Losses are part of our life. As a trader you should not try to score 10 out of 10 . If you are able to score 5-6 you have made it as a trader provided you have discipline to cut losses in time.

Texmaco has support at 139 and resistances are at 170-195.

Rail stocks are also showing strength. Kalindee Rail, Titagargh Wagon and Kernex Micro are buzzing.
Keep thesr stocks on radar particularly Kernex as this stock is consolidation with low volume and is trading in a range. A sharp explosive move is expected.

We wish all the readers of our blog a Very Happy and Prosperous New Year .

We would be happy to receive your comments and feed back.

Santa Claus Rally ???

Are our markets poised for a Santa Claus Rally ?? A Santa Claus Rally is result of people buying stocks in anticipation of the rise in stock prices during the month of January, otherwise known as the January effect.It occurs in the week between Christmas and New Year's Day.

Yesterday action seems to be indicative of this rally . Lets see how Nifty reacts at 5200 zone. On daily charts it making higher bottoms but not higher tops.
Last night on global markets Metal had a good rally . Resource Stocks buzzed all over the globe.


Gujrat Nre Coke has support at 65-69 and resistances are at 86-90-96

Global markets firm up , will we follow ?

Global markets have again bounced back despite all the odds. Lets see if our markets take a lead and follow it. Markets always have an element of surprise.It is also possible that Nifty may cross the hurdle of 5180 and reach a new high before this year ends or it may again slip down from those levels and forms another top. Well, we all come to know before the year end.

If Nifty is able to make a new yearly high then Banking stocks have to pitch in.


Canara bank has supports at 374 and resistances are at 415/ 432.


IDBI has supprt at 119 and resistances are at 131/138


REC is showing signs of continuation of the original trend - support is at 225 and resistances are at 255-265.

One should keep volumes low as long as Nifty is trading below 5080.

Be Stock specific with light volumes

Nifty is still giving whipsaw moves.
KPIT has support at 120 and resistance are at 150-180.

IVRCL Infra has support at resistances are at 380-390.

One should trade light and be quick to book profit/ loss.

Linda Bradford Raschke – 50 Time Tested Classic Stock Trading Rules

You can read trading advice from one of the great traders- Linda Bradford Raschke which makes an excellent set of rules for the trades.

The link is given below


http://www.tischendorf.com/

Not having a position is also a position

Nifty is still showing ranged moves with volatility and choppiness. The best way to trade this market is not to trade. Protection of capital is very important for traders.
In fact instead f " Stock Market " it has become " Market of Stocks"as we are seeing stock specific actions.
HCL TEch has hit the target mentioned bu us.

Ranbaxy and Tata Elxsi are consolidating . Keep these two on your radar and if they come near 20 DMA then they become a buy . Tata Elxsi looks interesting wih support zone near 220-230 and resistance at 270-290 zone.Ranbaxy lab has supports at 490. One should wait for the trade to come at them instead of rushing to buy .

IT Stocks at New High

Nifty is still stuck in broad range of 5000-5180. Globally all markets are struggling at the highs .
Dollar Index has bounced back to 77.

Nifty is ranged and choppy. IT stocks are making new highs. TCS, Infosys are trading at life time highs. Stocks which trade at life time highs keep on hitting new highs as they trade in a no resistance zone .

You can refer to our previous post .

http://swingtradingideas.blogspot.com/2009/11/stocks-and-sectors-at-life-time-high.html

HCL Tech has support at 325 and resistances are 358-370

Sugar may see some sweetness ???

Triveni has shown breakout with higher open interest. It has support at 105 and possible target could be 120-126.

On International Markets Sugar futures are surging up as adverse weather in Brazil may affect the production . We also updated it on our last post.

You can read about it by visiting the following links:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aUaxSdgjFDUc

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=avvVpQlj9fZw

Nifty is still in range . Its best not to trade Index futures at this juncture.

Bio con is on our radar with support at 270 and resistances at 290-298.Its has three down days and has taken support at 20 DMa. Health Care sector has good moves on Monday . Therefore, sectoral tailwind may also give Bio con some upward thrust.

Nifty is still in range

Nifty once again failed to break above the much hyped and much coveted level of 5180.
Its still in range . One should not try to trade in Nifty as its still volatile and choppy.

Berger Paints have shown breakout after long consolidation.It has support at 59 and resistance is at 75.

Banks stocks particularly PSU Banks have been hammered on last Friday. Lets see if they recover on Monday or not.
On International market Sugar futures prices are surging up but our sugar stocks remained muted to this development. Its difficult to find any secular sectoral movement . The best way to trade this market is not to trade breakouts and even if one wants to trade the volumes should be low and entries/ exits should be determined by using oscillators.

Focus on Individual Stocks

Nifty is still trading in a range.
435
Canara bank has supports at 395 and resistances are at 437.

Godawari Power is set for another up-leg with support at 149 and resistances are at 176-184

Its ranged and Dull Market

Nifty is still trading in range and its taking both long and short traders by surprise. Mid cap space is buzzing but one should follow time stops also. If you have bought some stocks om short term and if its not moving in any direction for the past five trading session then one should get out of it.
Some of our ideas have worked well. Nucleus Software has moved near its target zone.

Markets are trading in rage- trade light

Nifty is trading in a broad range of 5000-5150-5180. One should trade with small quantity ie the volume should be reduced by 60-70 %. This is a time when along with charts one should use oscillator like RSI or stochastic to trade at overbought/ oversold conditions.

Remember most of the money made in clear trending markets is lost by traders in these range bound markets.

Syndicate Bank has resumed its uptrend after correction.Support zone is at 90-92 and resistance zone is 96-98-103.

Focus on Mid Cap

Yesterday we saw melt down in Nifty . Metal sector saw pressure on the back of rising Dollar .Market may trade in a range . Individual stocks from Mid Cap pack may outperform the broader Indices.

NIIT Tech has support at 160 and resistances are at 180-200.

Dewan Housing Finance has support at 184 and resistances are at 209-219. It has resumed its uptrend after correction.

Time to trade light and book profits

Nifty is trading near major resistance zone. One should tighten stops and one should take profit in positions which are in the money and jettison extra baggage.

Polaris has support at 175 and resistance is at 200.

Markets pare gains

Nifty is unable to climb over the wall of 5180. It seems a major resistance now.
MID CAP IT stocks saw some action yesterday . Polaris Software broke out of a range.

Micro Tech ( 145-165), Nucleus Software ( 110- 138) looks to be gaining momentum.
Keep booking profits as market move near resistance zone

Markets may breakout

Nifty has been trading in a range for the past few weeks. One hurdle of 5120 is taken out . Now next hurdle is at 5180 . If this is also taken out then we may see more upside.Global cues are also supportive

Stocks of our New High list are doing well. Yes Bank has broken out of a range 260 is support and 285-300 resistance. Core Project has come out of slumber support is at 157 and resistance is at 214.
Our stocks trading ideas of Monday are doing well.
We used all the dips to buy rather shorting the market. Keep your analysis simple. Always trade in the direction of trend.

Markets are ranged

Nifty is trading in abroad range of 4920-5180 with 5100 zone as a major resistance zone.
GIC Housing Fin has moved up after consolidation support is at 90 and resistances are at 103-108. Graphite India has support at 67 and resistance at 80.

In ranged markets one should be quick to book profit.

Weekly Trading Ideas

Some of the weekly trading ideas are :



Stock Support Resistance

Neyveli Lignite 145 162
GSPL 90 105
Vijaya Bank 48 56
Jindal Steel & Power 650 750

TEN COMMANDMENTS FOR INVESTING By Mr Rakesh Jhunjhunwala

TEN COMMANDMENTS FOR INVESTING:
•Be an optimist! The necessary quality for investing success.
•Expect a realistic return. Balance fear and greed.
•Invest on broad parameters and the larger picture. Make it an act of wisdom, not intelligence.
•Caveat emptor. Never forget this four-letter word -R-I-S-K.
•Be disciplined. Have a game plan.
•Be flexible. For Investing is always in the realms of possibilities.
•Contrarian investing. Not a rule, not ruled out.
•Its important what you buy. It’s more important at what price you buy.
•Have conviction. Be patient. Your patience may be tested, but your conviction will be rewarded.
•Make exit an independent decision, not driven by profit or loss

What is common between Tiger Wood and a Trader

Course management of golf, one of Tiger's great hidden attributes, is no different from trade management in the markets — one of the keys to successful trading.
 

 

   Adam Hewison,President INO.com,Co-creator of MarketClub.com  share about his ideas .

 

You can read about it . by clicking the link given below:

 

http://club.ino.com/trading/?p=1777

 

 

Have a nice weekend ahead.

The sun never sets on Dubai World -- Will it set this time.??

Dubai Debt Crisis has sent shock waves across the globe bringing back the memory of worst financial crisis which we witnessed last year.

American Markets are closed on account of Thanks Giving Day holiday. European Markets are feeling the pinch and most of the markets are trading in negative with loss of more than 2 %.

One can read about the crisis in brief at

http://www.bloomberg.com/apps/news?pid=20601087&sid=aRsjlClzl500


Our markets were showing signs of weakness and this crisis may act as a trigger for a deeper corrections.
Nifty 50 DMA is around 4970 and if Nifty is not able to trade above it then we may see the possibility of retesting it the recent pivots of 4538- 4550.Every major dips should be used to buy. One can refer to our list of all time high stocks for reference.
Health care sector do well in falling market.

Glaxo has had four days of correction and has found support at 20 DMA . It has support at 1590 and resistance is at 1715.

Orchid Chemical has support at 175 and resistance at 210.

Realty, Infra are the weakest sectors and Banking stocks may also get affected in short term by the negative sentiments arisen out of Dubai crisis

Dollar Weakness

We are witnessing persistent weakness in Dollar, which fell to 14 year low yesterday after the Fed said it plans to keep interest rates at "exceptionally low levels" for an "extended period" -currently the Fed funds rate stands at a range between zero and 0.25 percent.
Weakness in Greenback will encourage dollar-carry trades. It means US Investors would buy higher- yielding assets outside America.
This may result in more money flow to Emerging Markets.

Commodity stocks may perform today. Keep on booking some profit as we inch higher.

Sesa Goa has supports at 350-365 and resistance are at 400-430.

One should keep Nifty Index stop of 5000 for all short term long positions as exhaustion signs are still there.

Market faces stiff resistance

The momentum seems to be exhausting. Do we see sign of reversal of uptrend for short term - the answer is no.
Most of the stocks on charts seems huffing and puffing.
Though there are some pockets where we see strong momentum.
Dollar may bounce back for short term and this may put pressure on Commodity stocks.

Cement, Tea and Sugar Stocks including Tata Coffee had a field day yesterday. We see the momentum picking up further.

ITC has support at 260 and resistance at 300.
Our New High List is to be watched out carefully as it is the place where strength is.

Momentum Continues

Nifty is on the verge of retesting its recent high of 5181 on the back of strong momentum and positive global cues.
We were the only one who never went short on the market and instead bought every dip. There is no rocket science involved in our analysis. We remained with trend which is up.
Cipla, ITC, Jindal steel n Power, Jindal Saw , GAIL are trading at new highs.


Torrent power has resumed its uptrend after correction, it has broken out of bullish flag formation. It has support at 310 and resistances are at 370-400. GSPL has supports at 90 and resistances are at 113- 125
PSU banks are showing breakout after consolidation.

Stocks and Sectors at Life Time High

There are many stocks which are trading at all time high . While Nifty is yet to catch its life time high level of 6357 the following stocks are trading at life time high. What does this indicate? It indicates that these stocks are at present have more relative strength than Nifty and they may continue to outperform Nifty in near future too.
How one should trade them ? The best way to trade is buy the stocks on dips.The stocks are :

Mphasis
Infosys
Nestle
Proctor and Gamble
Marico
Dabur India
Mcleod Russel
Torrent Power
Rec Ltd
Jayshree Tea
Exide Industries
Amar Raja Batteries
Rallies India
Godrej Consumer
Mahindera and mahindera
Maruti
Hero honda
Lupin
Dr Reddy
Renuka Sugars

LICHF
Central Bank,
Yes Bank
PNB

Sesa Goa

If you further classify the above stocks into sectors- the sectors are FMCG including Sugar and Tea , Auto, Auto Ancillary , Pharma and to some extent Finance .
These sectors should continue to do well and one should have exposure in select stocks of these sectors, ie one should not buy all stocks but have exposure to some stocks of all sectors.
These stocks will correct and find support at 20 - 50 EMA on daily chart. The best way is to buy these stocks near 50 Ema with small quantity and then add more once it trades above 20 EMA . Sometimes it may not retest 50 EMA then the best way is to buy near 20 EMA.
One can find the charts of all the stocks on http://www.icharts.in/charts.html

If you have been following our blogs regularly then you may find that we have discussed about most of the stocks.

We discussed about Baltic Dry Index on our blog on 11 November . Money Control also discussed about it on 20-11-09.

Who Makes A Good Trader

Bloomberg has an interesting article about who makes good traders.

Brandon Adams, who teaches behavioral finance at Harvard University's Department of Economics, says some of the best candidates for Wall Street trading jobs are the professional card players

Before, we were asking about GPA or the Math/Physics Olympiad," Satanovsky, a former Russian national bridge champion, said in a telephone interview. "Now, we're asking questions about poker successes."
You can read the article by clicking the link below:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=alximP6.Eta8

 Our Comments: On a lighter note -Sounds  familiar, do you know  that some of the averaging methods like pyramiding trading,Martingale (probability theory) comes from gambling world and  The name Monte Carlo Method is a reference to the Monte Carlo Casino in Monaco.

Have  a nice weekend.

 

Use Dips to buy strong stocks

In an uptrend dips offer opportunity to buy strong stocks.

Shipping and Mid Cap IT sector is going strong.  some of the interesting stocks are:

 

 

 

 

                      Support      Resistance

Essar Shipping   61           77-88
   SCI               140               155- 170

 Polaris          156              184
  KPIT                98           130

 

 

On downside if Nifty is not able to trade above 4870-4900 then all short term long bets are off

Shipping Sector moved up as expected

We posted on our blog about the move in Baltic Dry Index and its impact on commodity and Shipping stocks. You can see the move thereafter in Shipping Stocks and Commodity Stocks like Sesa Goa, Bhushan, JSW , SAIL etc.
Readers can refer to the earlier post .

http://swingtradingideas.blogspot.com/2009/11/sectoral-relation-ship-and-baltic-dry.html

Some of the interesting charts are:

Elecon support 85 resistance 105

Glenmark support 240 resistance 275

Usha Martin support 70 resistance 105

Take 4900 as Index Stop for all short term long trade

Market actions for the past two days  reflect some tireness at higher levels. Though we have yet to see a sign of reversal of trend.

 For Nifty 50 and 20 DMA are very close and 4900 is the place where the dividing line is. As long as Nifty is trading above 4900 the trend is up.

 

Hexaware Technology seems to be breaking out of its resistance zone of 95. If its able to trade above 95 then we may see 110-118 levels with support at 85.

 

Keep Your Analysis Simple to Make Money

Just to remind our readers that in our earlier blog " Road to Recovery" we made a very simple analysis and started buying in the correction when majority was going short. We stood with our very basic analysis that in bull market one should and must buy corrections.
You can refer to our earlier post of 04-11-2009

http://swingtradingideas.blogspot.com/2009/11/road-to-recovery.html

Ride the move. Have fun.

Bio Con on radar

Bio Con has started moving up. Support is at 256 and resistances are at 300-320

This Weeks Trading Ideas

Hope you all  had a nice weekend.

Markets are slowly and steadily inching towards the high it made this year. Though the Big Brother Dow Jones is trading at this year high, our markets are lagging behind and may catch up this week

Some of the stocks which are showing signs of strength and will be on our radar are:

                                  Support                        Resistance

APIL                          540                          580-600
Jindal Steel &Power    680                                800

Dena Bank                   68                             80

Mid Cap IT

Yesterday Mid Cap IT stocks moved up. KPIT, Nucleus Software, FSL and Moser baer have showed signs of up move after long consolidation.Dollar is expected to rebound on a short term time frame.

Moser Baer has support at 78 and resistance is at 95-100

Sectoral Relation ship and Baltic Dry index

Yesterday Baltic Dry Index bounced back. This is an index which tracks shipping freight rates on real price basis ( no futures trade). Most of the cargo demands come from transportation of crude oil, iron ore, steel, copper , agri commodity etc.
Therefore- shipping stocks had a field day yesterday. One should be quick to relate it with the above mentioned commodities- Sesa goa, Gujrat NRE Coke, sterlite also moved in tandem with shipping sectors.
What Is The Baltic Dry Index?

Despite the name, the Baltic Dry Index has nothing to do with markets in Lithuania, Latvia or Estonia. Instead, it’s all about the cost of shipping major raw materials. Like iron ore, coal, grain, cement, copper, sand and gravel, fertilizer, even plastic granules.

The value for the index is determined by the London-based Baltic Exchange, which traces its origins back to 1744. Each day, the exchange canvasses hundreds of brokers around the world for price quotes on moving goods. For instance: Shipping 100,000 tons of coal from South Africa to Japan, or 50,000 tons of iron ore from Australia to China. It then aggregates the quotes to form the Baltic Dry Index.

Basic economic principles of supply and demand explain the significance of the index…

The supply of cargo ships is tight and inelastic. It takes roughly two years to build a new cargo ship. And the high cost of each prohibits docking ships during slow periods. In other words, a change in cargo rates does not change the number of ships in operation. So even the slightest changes in demand for shipping raw materials results in a change in the index.

And because the index tracks the cost of shipping raw materials – the precursors of economic output – instead of intermediate or finished goods, it provides a precise and rare measurement of the volume of global trade at the earliest possible stage.

A sharp move up, means global trade is increasing. Conversely, a sharp move down, means it’s decreasing. Since global economic activity ultimately influences the equity markets, sharp moves in the Baltic Dry Index often predict and precede similar moves in the equity markets.
Of course, there are other reasons to favor the Baltic Dry Index over other leading indicators, including:

No room for speculation, Not subject to revisions,An inability to be manipulated,Real-time, daily updates

You can see its chart and alo compare it with charts of Gold, crude Oil , CRB Index and may other commodities by clicking on the given link

http://www.investmenttools.com/futures/bdi_baltic_dry_index.htm
The funny part of trading is that sometimes these relationship work and some time do not.

Power Sector Buzz

Some of the stocks from power sectors had a nice move yesterday.

GVK Power looks interesting with supports at 47 and next resistances are 55-60.

Association Of Technical Analysts , India

We often get emails from the readers about any certified course on TA.
ATA is India's meeting place for technical analysis of financial markets.

One can contact them for getting a certified course in Technical Analysis

Interested traders can visit the website :


http://www.taindia.memberlodge.org/

Or they can write to india1.ta@gmail.com for detail information.

Meet the high-tech traders making millions

Secret software is helping a new breed of high-speed traders get really rich, really quick, writes Michael Evans.
You can read the story by clicking the link:


http://www.theage.com.au/technology/biz-tech/meet-the-hightech-traders-making-millions-20091106-i1ri.html

Ride the move

When other were fearful we were greedy and picking our stocks at lower prices. Now its time to ride the move.

This is how swing trading , chart patterns with little analysis of the market environment are used for trading but mind you market may prove us wrong therefore, we use our stops and sometimes market may move in our direction after hitting our stop price. One should take all these in ones stride. There is no holy grail in this market. We all have to learn it and practice it.

Ride the move.

Power of Charts

If you remember in our October Post we discussed about the trading with Guts vis a vis Mechanical Trading and presented charts of two stocks; Torrent Power and Mcleod. Both are still going strong and did not tank much during the recent melt down.
http://swingtradingideas.blogspot.com/2009/10/mechanical-trading-and-trading-with.html

Its another way of judging your stock, its known as relative strength. It is a very usual observation- what your stocks did with the markets? Did they go down faster than the market or stood firm. This relative strength is not to be confused with Beta of the stock. In fact it can be loosely compared to Alpha of a stock.

Our this weeks Ideas are : Aptech Ltd Support 166, Resistance 213/220, Harrison Malyalam Support 100, Resistance 138 and Andhra Bank Support 109, resistance 130/ 150 .

Aptech was hammered down and may bounce back. Bank of India is another stock which has been butchered a lot. Lets see how these two beaten down stocks behave this week.

The Dynamics of a Trader’s Mindset

Lets see what Market Club - Trades blog has in store for us

In this presentation, Mark Douglas explains the dynamics of the trader’s “mindset” at a very fundamental level. You will gain a comprehensive understanding of how you must first learn to think like a trader before you can fully utilize your technical or analytical abilities.

http://club.ino.com/trading/2008/07/saturday-seminars-the-dynamics-of-a-traders-mindset/

Weekend Reading

What are the traits of a successful traders ?
Toni Hansen, Full-time trader and mentor sharesher ideas .
You can read the article by clicking on the given link



http://www.tonihansen.com/trading-lessons.html#traits

Have a nice weekend.

Our strategy has paid

We kept our rule very simple.
We identified that its a bull market and did what one should be doing in a bull market - buy on dips.
Trading should not be based on too much analysis as too much analysis leads to paralysis.

Today is time to book profit for weekend . Our ideas about PSU bank- Dena and Allhabad bank , Biocon , Nagarjuna Const, JSPL worked well.

For next week some of the swing trading ideas are;

BHEL Support 2140 , resistance -2360/2530,

SAIL - Support 156 , resistance 180-195.

GSPL- Support 80, resistance 100-110

Trading is fun only if your monthly expenses are not dependent on it.

Have a nice weekend ahead.

Where GOLD is headed ?

You can read what Jim Rogers has to say about GOLD.

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aDAX9iFoOy7E

Dollar Weakness?

Fed has keep interest rate unchanged and this made Dollar to dip further. It will have positive impact on commodity . But it remains to be seen how commodity demand picks up in near future .

As long as Nifty is trading below its 50 DMA (4870)one should trade light with less quantity and be quick enough to take profits.

Jindal Steel and Power looks interesting as it did not tank much during the recent melt down . It did not dip below its 50 DMA , 608 is acting as strong support and resistances are at 685 / 735 . If its able to trade above yesterday high of 650 it will gain further strength.

Do you want to trade stocks for a living?

Hope you will find it interesting.


http://www.swing-trade-stocks.com/trading-business.html

PSU Banks on watch

Dena Bank is finding support at 54 and Allhabad Bank at 108 with possible resistance at 65/70,126/ 130 respectively.

Of late, PSU Banks have been hammered a lot and showing signs of catching up with the original trend

Road to recovery?

We have had a three week of corrections. Going by history time wise it usually takes 4-5 weeks of time when corrective phase gets over. Are we in bear market ?? The answer is no . Technically speaking, as long as Nifty is trading above 200 DMA we are in a bull market. This is a basic thumb rule which we follow.

Now the premise is clear that its a bull market. Now next question comes , what should one do in a bull market ? The answer is buy on dip.

These corrections offer opportunity to buy. One should be doing some cherry picking in quality stocks in small quantity .


Bio Con has found support at 100 DMA at 230 . If this support is held then the stock can retest 260-280 zone.
If Nagarjuna Construction is able to trade above 153 then it may move up to 170-180 zone.
Gold is back to action again.If you remember we posted Louise Yamadas view on Gold.

Learn a new thing everyday.

Dennis Gartmans Trading Rule- Must Read

Trading rules from great traders are always worth reading. If you spend some time to understand the concept behind each trading rule this will improve your trading skills and take you to the next level.





Dennis Gartman’s Trading Rules List

Posted using ShareThis

Support Zone for Markets

The last week in the markets have been very wide in range, and volatile too. This makes for an emotional environment, and it is often best to step aside at times like this and wait for a lower risk environment. The markets are quickly becoming oversold and approaching what should be strong support levels, so it may be that a snapback is soon to come.
Nifty 100 DMA level is 4630 . Instead of making a futile exercise of where market would find support its wise to find a buying zone . For us it is 4500 ( if Nifty reaches there ) . Another way is to pick up good stocks with 25 % quantity and keep on adding as market moves in our favour.
As long as Nifty is trading below 50 DMA ( 4859)the short term trend will remain down.


Canara bank is a buy only if it trades above yesterday high of 352 with stop of 335 for a possible target of 375-396.

From FMCG stable HUL looks interesting.
Hope you all had a nice weekend.

Time to revisit some Technical Indicators

 

Trading holidays can be used to learn about some indicators.

 

Indicators are used as a measure to gain further insight into to the supply and demand of securities within technical analysis.

Pl click thr link to know more...............

 

http://www.investopedia.com/slide-show/tools-of-the-trade/default.aspx

 

 

 

One should also keep in mind that most of the indicators are lagging indiactors.

 

have Fun !

Weekend reading- Article by Robert Shiller

Robert Shiller is professor of economics and finance at Yale University

Many appear to think that the increasing complexity of financial products is the source of the world financial crisis. In response to it, many argue that regulators should actively discourage complexity.
This article can be found at:
http://www.ft.com/cms/s/0/c4a74ba2-ab83-11de-9be4-00144feabdc0,_i_email=y.html
"FT" and "Financial Times" are trademarks of The Financial Times.
Copyright The Financial Times Ltd 2009

Book 50 % Profit in Sterlite

Sterlite has moved up - its time to take some money off the table for weekend .

Now the stop should be at 760.

 

 

 

Have fun and learn the art of swing trading.

 

Will welcome your feed back comments

Big Brother has Rallied - we will also catch up

Big Brother- Dow Jones rallied last night on the back of good GDP data though home sell figures are still a concern . The rally by big brother may see a strong rally in Asian markets too.

Our yesterday ideas Sterlite and Ranbaxy Lab are expected to do well today - book profit by the end of the day so that you may spend it on weekend which is going to be an extended one.

Today ideas are Hindalco with support of 115 and resistance at 140-144. Crude is coming back and good GDP number from USA, and a weak Dollar may see it going up therefore, as a crude proxy one can think of Cairn with stop at 260 and resistance at 290-296 .

Realty sector is a high beta sector and was butchered during these down days . Its a very short term play Ajmera Realty has support at 240 and resistance at 290- 315.

We have been telling our readers that when panic sets in - one should buy good stocks.
We for one never forget the old street saying " Be fearful when others are greedy and be greedy when others are fearful"
We have been greedy and this weekend we intend to indulge on some shopping spree after booking profits.
Wishing you a nice weekend ahead.

Sterlite turns back

Sterlite is making a double bottom on chart ,  it has resumed its uptrend, support is at 709 and target could be 800-830-860

Trailing stop for ranbaxy lab is 375

Today Ranbaxy Lab  buy price was triggered and stock is moving up . One should keep a stop of 375 now.

 

Punj Lyod and Ambuja Cement

Punj Lyod has been hammered a lot . Now the risk seems limited .Its trading above 200 DMA

It has support at 195  and resistance it at 236 and 280

 

Similarly Ambuja Cement is trading just above 200 DMA

Where do we go from here ???

The panic has set in and these panic offer buying opportunity . One should be doing some cherry picking with small quantity.

 

Companies with domestic focus growth story  like ITC, Dabur, Tata Chemical, Hero Honda, Bajaj Auto , JP Associate   will remain on our radar .

 

Ranbaxy Lab is a buy above 385 with stop of 360 for  a  possible target of 415

Uco bank is turning up

 

 

UCO Bank is turning up after taking support at 50 DMA . It has support at 50 and resistances at 57-61.

 

 From todays ideas only one stock Mcleod Russel hit the buy triggger price and it is performing well  support is at 197

Some great opportunity at this fall

Well, a few days back everybody thought that this market would not fall and now everyone has become so fearful as if this market would never rise. This is the same game of fear and greed .

Nifty is still in uptrend and is going through correction phase. It may witness some volatility and it has got major support near 4700-4750 zone.
This correction once it gets over would throw many opportunity to buy those stocks which would see momentum again.

Mcleod Russel above 207 with stop of 195 , target -236-280 , Cairn above 278 with stop of 266 for target 290-300 and BHEL above 2370 with stop of 2300 and target of 2500 are ideas for the day.One has to keep in mind that markets are in short term downtrend trade with small quantity and buy only above the price mentioned.

I would also look for IVRCL, JP Associate, Cairn , Polaris and Union Bank as investment opportunity when market falls more from here.

Markets are choppy

We are witnessing lots of volatility and whipsaws. There are signs of exhaustion and some of the stocks are punished on the basis of quarterly results.

How do we trade in this market? Keep volume low and do not buy breakouts , wait for the signs of strength.

Let us take an example of Escorts. You can see on the adjoining chart that after breaking out of the range of 105-109 with good volume it touched a new high and corrected with five down days. It made a high of 118.50 today. How do we trade this stock. If tomorrow it is able to trade above 119 then only it will show us strength
Today it has taken support at 20 DMA and oscillator are at oversold level and any uptick will see it turning up.

Escorts may resume its uptrend only when it trades above 119 with support of 108 with possible target of 133-150.

Buy on dips: This weeks Ideas

Markets are expected to bounce back .
Here are some swing trading ideas. Fiance sector looks strong on charts.

IDBI - Support 124, target 150

IDFC - Support 150, target 180
BOB - Support 485 target 560


Ivrcl - Support 380, target 430

Gwalior Chemical - Support 97, target 114-120

Jubilant Organic - Support 260, target 265

Louise Yamadas view on Gold

Louise Yamada the author of MARKET MAGIC, published by John Wiley & Sons, which was released in March 1998 and reviewed as "a monumental book, one that all serious and professional investors should read.
She shares her view on Gold, Dollar Movements and market related issues

http://kingworldnews.com/kingworldnews/Broadcast/Entries/2009/10/23_Louise_Yamada.html


Hope you all had a nice weekend.

PTC has similar pattern as we saw in Federal Bank a few days before

PTC has started moving up after six downdays , seems to be a low risk trade with stop at 95 and a possible target of 110

Buy on Dip

Markets all over the Globe seems to be on strong wicket and more money is being pumped into the riskier assets. One thing for now is sure its not a market to short its a buy on dip market.

Realty sector was beaten down yesterday and this being a high beta sector is expected to see a bounce back today.Some of the ideas are mentioned below with the caveat that I do not trade intraday because serious money is made only when one takes positional calls . We discuss the stocks to see how the swing trading ideas perform as per the chart patterns

DLF: Support - 435, target-490


Cipla: Support-280, target- 300

Yes Bank: Support -229, target- 277-300

Pidilite Industries: Support -155, target -181

FMCG sector is buzzing and Marico LTd is trading at new highs with heavy volume. I personally like to trade in those stocks which trade at new high as it is sign of strength.
Marico Ltd has support at 95 and target could be 130.

Trading Ideas for the day

Crude Oil had bounced back and global markets have downdays yesterday and we are seeing some valuation concerns at higher levels.

 

Dollar  may bounce back for the short term

Cairn is a proxy crude play.

 

Cairn : Support 269, resistance 295-300

Torrent Power  : Support 280, resistance 350

Nucleous Software  : Support 150, resistance 131-146

Opto Circuit  : Support 205, resistance 245

Is U.S.A an empire in decline ???

Niall Ferguson, MA, D.Phil., is Laurence A. Tisch Professor of History at Harvard University and William Ziegler Professor of Business Administration at Harvard Business School. He is also a Senior Research Fellow at Jesus College, Oxford University, and a Senior Fellow at the Hoover Institution, Stanford University.


According to him the U.S. is an empire in decline,
"People have predicted the end of America in the past and been wrong," Ferguson concedes. "But let's face it: If you're trying to borrow $9 trillion to save your financial system...and already half your public debt held by foreigners, it's not really the conduct of rising empires, is it?"

Given its massive deficits and overseas military adventures, America today is similar to the Spanish Empire in the 17th century and Britain's in the 20th, he says. "Excessive debt is usually a predictor of subsequent trouble."

OK... Here's some more Niall Ferguson... Ferguson dismisses the dollar loyalists, citing the British pound -the last international reserve currency - as his example. "These things don't last forever" but don't expect it to happen overnight. "It's a long multi-decade process," he states. Even with the dollar near a 14-month low against the Euro, he claims it's not without historical precedence for the greenback to lose "another 20%" this year.

For international investors the loss is enough to offset this year's stock market gains. Not exactly great motivation for foreigners to keep buying the almighty dollar."

Book Partial Profit In HCL Tech and Tata Power

 

Book 50 %  Profit In HCL Tech and Tata Power.

Realty sector is buzzing .Keep India Bull Real Estate on your radar it may move above 298 which is a recent top and support is at 285.

 

 

Keep trailing stop of 1390 for Tata Power

Tata Power ;  one of our morning ideas has moved up.

 

 

Keep trailing stop of 1390 for Tata Power.

 

 

Trading Ideas - buy on Dips , keep Power Sector on your radar

Today we may see a dip in the markets and these dips should be used to go long. Power sector is buzzing and so are the some small IT stocks.
Today's ideas are

Graphite India - support- 63 target- 80
Tata Power support- 1370 target -1518

Another side of the story

Another Stock Market Bubble?
One should always read about the opposite views also. you can read this article by clicking on the link given below:

beta.thehindu.com/opinion/op-ed/article19895.ece#

My Comments: We as a trader look at the trend as long as trend is up and market is taking supports at key levels we remain long. There is no sign of trend reversal yet.If Nifty is not able to trade above 4920-4950 then only we may assume that the uptrend is reversed.Till then its buy on dip market.

HCL Tech

HCL Tech is moving up after consolidation. Support is at 300 and resistance is at 348

Keep Sterlite on your radar

Copper futures are making a new highs. Sterlite has support at 810 and target could be 900-950.

Market is the biggest teacher

Hope you all have a nice weekend.
Markets are trading at the new high of the year and most of the participants are skeptical about this rally and when majority of the participants are predicting for corrections ; markets do not correct .What strategy one should follow then ? Well, I usually tighten the stop and use some sma of 9-12 days just to lock my profit. You should also fine tune some strategy of locking in your profit.
Kenny Rogers used to sing, “Don’t count your money, when you are sitting at the table, there will be time enough for counting, when the dealing’s done.”
markets are still in strong uptrend. Some of the swing trading ideas are given below. The sectors to watch for are Banking , Realty, Sugar and Cement .

Anant Raj Industries : Support 143 Resistance 180-188
Dhampur Sugar : Support 103 Resistance 130
Union Bank Of India : Support 265 Resistance 300-325 ( Trading at All Time High )
Gujrat Alkali : Support 125 Resistance 160
Prism Cement : Support 47 Resistance 58
RCF ( Rastriya Chemical) : Support 70 Resistance 83-89

These are some of the ideas from different sectors . Banks are looking strong on charts particularly PSU banks. Yes bank is also looking strong . Lets see how these ideas work out in the coming week.
Will keep you updated .
Have fun in your trading and learn to cut the loosers and stay with the winners.

How the swingtrading ideas with chart Pattern work?? Federal Bank

You can see the moves in Federal Bank which was our swing trading idea. The sectoral tail wind was there plus it had 6 down days and stopped falling.

It showed reversal of down days and was a very low risk opportunity. It is nearing its target.

 

Have fun and learn.

OBC Hits Target - time to book

Our one of the  swingtrading ideas OBC hits target . Time to book profit .

Todays Ideas

Global markets are supportive . The big brother Dow had a closing above 10000 for the second day in row. This is a sign of strength. Energy sector did well on rising crude price. Therefore, keep an eye on Essar Oil, Petronet. Essar has support at 160 and resistances are at 180-185. Petronet has supports at 73 and resistance is at 80-82
Cumins India is another stock which seems attractive on charts. Its support is at 376 and resistances are at 438/ 454.
Do not try to short this market, its buy on dip market .

Glaxo hits target

Glaxo hits target time to book profit

The momentum is strong - ride it

Global markets had a blast , now its our turn . Banks will see action today. HDFC Bank stop is at 1640 target is 1820 -1900. Vijaya Bank support is 50 target is 58-62.
IDBI support 125 target 160.

Traders identify the trend take position in the direction of the trend and ride it. Its very simple.
Have fun

Power of swings on charts

You can refer to our trading ideas for the month of September and October and see the ideas which we traded on the basis of swing on charts.

Sesa Goa, Jindal steel and Power , HOEC, HCC just to name a few ideas that have worked well.

Its a learning for all of us.

Have fun and enjoy the party

Federal bank

Federal bank is coming out of 7 days of down fall. Stop is at 215 and target is 250-60.

Momentum will continue

Strong global cues, good IIP numbers, coming festive season well, the party is on.
Here are some of the ideas:
India Info line -support 142, target 173
Arti drugs- support 88, target 104
Apollo tyre - support 46, target 55-60
Gujrat Ind & Power -Support 110 , target 131

Stay with Mid Cap

Nifty is trading in a range for the past one week. Its not wise to trade Nifty . As I have mentioned earlier I sold some out of money call and earning on time value.

Mid cap is the space to be in. Some of the ideas are - Central bank is a buy if it trades above 140 with stop of 128 and target of 164. Mercator Lines with stop of 60 and target is 77. FCS Software support is at 105 and target could be 144-150.

There are two large caps which are going through corrections and are oversold and offer a low risk opportunity. HCL Tech and Maruti stops are at 280 and 1420 and resistances are at 330/ 340 and 1630/ 1680 respectively.
Dollar has bounced back and it will put commodity stocks under pressure.

Mechanical trading and trading with guts

Most of traders I have come across who trade on system based trading have not been able to make money consistently. Why?? Human brain is more efficient than a mechanical trading system . One has to analyse the human greed, fear and hope to make profitable trades. I have often found that whenever market closes on extremes ie either at days low or at days high the very next day it closes at opposite. For example Nifty has closed near days low on Friday and Monday we may see it closing near the high of the day. If it happens then those who went short based on their mechanical trading system may see the stops being hit.
Now the question comes- what system one should follow and the answer is a combination of both. One must have a system but should not follow it blindly.

I have come across this article by Van K. Tharp, Ph.D titled Intuition and Trading.

The link is
http://www.iitm.com/Weekly_update/Weekly_443_Sept_30_2009.htm#feature

He has given one chart also. I too love to trade these type of stocks which show a clear pattern which gives you extraordinary results and the best part is that no one talks about these stocks on various business channels. These are the stocks which gets very little attention in media but nevertheless gives bonus rewards to traders . I made a huge profit in these two stocks. Study the charts and learn to identify the similar patterns on charts of the other stocks .I am giving you the charts of Torrent Power and Mcleod Russel.
These two stocks are at new highs and there is more upside left. The idea is to develop a system and buy when it reaches either 20 , 40 or 50 Dma - now which average is to be used is that part of system which you have to develop.
Have fun.

Glaxo

Glaxo has come out of consolidatiom, with sectoral tail wind behind it it has upside potential.

 

Support 1470 resistance is at 1620

Sectoral Moves

The readers of this blog can remember our take on Shipping sector a week ago. Yesterday everybody on TV was talking about Baltic Dry Index moves which we identified on our charts a week before. Trading is all about being ahead of the crowd.

Today's ideas are REC which has come out of long consolidation support is at 200 and resistance is at 225.Essar Shipping though does not move much but can be taken with strict stop of 65 and target could be 80

Keep Power sector on your radar

Some of the stoks of this sector  like REC, Neyveli Lignite are moving up after a long consolidation. On Charts they have formed bullish flag and now are breaking out of this

consolidation phase.

HCC has broken out

HCC has broken out after a long consolidation and so does Neyveli Lignite. Support is at 120-122 and resistances are at 145-160
Pharma and FMCG space is also buzzing up. We will keep Cipla and ITC on our radar.

We may see some action on Oil n Gas Sector

Crude Oil prices are firming up. Bonus announcement by the RIL will see some positive sentiments for Oil and Gas sector. GSPL has support at 77 and resistance is at 87. Cairn has support at 252 and resistance at 275-290.
Our ideas Renuka Sugar, HOEC and Sesa Gao had out performed the market . Balrampur Chini is also showing strength with support at 125 and resistance at 160 . Hindalco has support at 115 and resistance at 155-16

Gold and Silver are on new ground

Gold and Silver, the two precious metal are doing good and are set to make a new high . Gold had a bull run in 80s and this time again its in a new bull market because of falling Dollar, fear of rising inflation and a bit of rise in Oil prices. Once these two metals touch a new highs it will attract more buyers thus pushing the prices further up.

You can watch an interesting video about Gold chart pattern.


http://broadcast.ino.com/education/gold106/

Learn a bit about chart pattern and have fun.

OBC hits first target

OBC hits first target . Book half of profit

HOEC on radar

HOEC seems to have corrected on charts. Support is at 290 and resistances are at 345 -395

Sesa Goa Hits Target

Sesa Goa has hit target. Its time to book profit.

Market has more power on upside, Banks may perform

Global cues are very strong. All across the globe Banks have witnessed sharp up move.


Orient Bank , Syndicate Banks are good trading ideas. Orient bank has support at 220 and resistances are at242- 262-280.

Sugar Stocks are back

Sugar stocks are buzzing. Renuka Sugar has supports at 190 and resisances at 206-212

Nifty 4880 is crucial

Today we are witnessing signs of weakness. If Nifty is not able to trade above 4880 then all long positions should be squared off.

Sesa Goa has moved up. I have booked profit. FMCG stocks like HUL and ITC are on my radar

Todays Idea

Sesa Goa seems to have corrected. Support is at 258 and resistance is at 284.

Common mistakes traders make

Here is a very good piece of information for all traders. What are the 50 common mistakes traders make.
You can read the 50 mistakes and see what are the mistakes you also commit and try to improve upon them.

http://www.investmentpostcards.com/2009/09/29/fifty-common-mistakes-traders-make/

Hope to see you become a smart trader.

Buy on Dip

Well, US markets have not been able to trade above 20 DMA and are expected to retest 50 DMA. Nifty has key supports at 4850-4880.

 

One should use the dips to buy and as long as 4800 in intact the trend remains up. IDBI, IDFC looks good on charts with support at 118 and 150 respectively.

 

Infosys is going to announce its result this week. If it comes out with positive result then we may see moves in Rolta and 3 I Infotech

 

Jindal steel and Power

Jindal steel and Power seems to have resumed its uptrend after correction. Support is at 570  and target could be 650. Looking at market levels one should not feel too excited and buy in small quantity in cash with strict stop.

Sector Movement

Lets take our discussion on sector move a bit further. The readers of this blog can remember that in our September 13 post we told you about the movement in Banking sector . http://swingtradingideas.blogspot.com/2009/09/keep-banks-on-ur-radar.html
http://swingtradingideas.blogspot.com/2009/09/some-weekly-trading-ideas.html

We mentioned about PSU Banks moves on charts. When a sector is in strong uptrend it corrects and then resumes its uptrend with greater force. Today we saw this happening in banking sector. We saw secular moves in all banking stocks . Private and PSU bank stocks all had a great rally today.

Tomorrow is the last trading day of the week. I intend to book profit in all my positions except in Bharti Airtel. Bharti Airtel - MTN deal is off and this may prove good news for the Bharti . Form here on the downside is limited and a relief rally is expected.This was our weekly pick also.
We are going to have a long weekend.
You can also use the time to read good books . One such book I would recommend as a trader is " The Power Of Your Subconscious Mind" by Dr Joseph Murphy.

Sugar sector is Buzzing

Suhar sector is moving up after the consolidation. Dhampur, Andhra Sugar are moving up.

 

Andhra Sugar has support at 130 and resistance is at 160 . Dhampur has support at 95 and resistance at 130

Sector Movement and Its Importance in Stock selection

If you want to buy a property which you think would give you manifold returns in future then you have to keep only one thing in mind - location, location and location.

One of the greatest trader and one of my favorite trade the greatest Jesse Livermore had echoed something similar about stocks. He always looked for sector , sector and sector before buying a stock. You have a higher probability of making money if you select the strongest stocks from the strongest sector. Today we saw sectoral move in Oil and gas . RIL, ONGC, Essar Oil, Chennnai Petro, GSPL, Petronet all moved. If you were smart enough to identify this sectoral move early in the day you must have earned a handsome profit.
Sectoral movement always plays a key role in stocks movement.
Today we also saw movement in Shipping sector.Some news about the Baltic Dry Index also helped this sector to move up.You can read the news articles by clicking on the given links:
www.bloomberg.com/apps/news?pid=newsarchive&sid=aKmdxZjukbao

The Baltic Dry Index, a gauge of the cost of carrying dry bulk commodities such as iron ore, coal and grain, had made a high of 11600 in January 2008 . It is now trading at 2300. Now the question comes should we buy shipping stocks ?? The answer is no. We should look for the follow up buying tomorrow. If we dont see any further move in Shipping and Oil and Gas stock then we should stay away from these two sectors.

Both these sectors are deeply influenced by the movement of Dollar.Dollar is expected to remain weak. Now weak Dollar will also have negative impact on earnings of IT sector. If Dollar remains weak how commodity price would get affected ? Will the inverse relationship between Dollar and Commodity price go on as always ? Well, markets are markets they do not act the way we expect. Markets have their own logic and markets are never wrong opinions are. You can read about Dollar loosing its status of reserve currency in future :


http://online.wsj.com/article/SB125418301226347949.html

For todays trading I will keep Bio Con Ltd and Glenmark Pharma on my radar with stop of 245 and 225 respectively

Sector Rotation

Shipping Sector moves two steps forward and one step backward.It remains mostly sideways .

But, today Shipping Corporation seems to get out of correction.Support is 135  and resistance is at 150.

 

If it is able to close above 140 then we may see it retesting resistance zone of 150-153.

Oil and Gas sector moves

Oil and Gas sector is witnessing a fresh up move . Essar Oil has support at  12- 155 and resistance at 180-185.

Update On Patni Computer and Nagarjuna Constrcution

Patni has moved up now its time to book partial profit and keep  stop at buying price . Nagarjuna Construction is resuming its uptrnd and so does Sesa Goa

Some weekly trading ideas

US market surged up followed by  a rally all across the globe. This augurs well for our market and may give a good festive start to the week.

Shorts will run for cover and this may provide further fuel for another rally on Nifty.
 
Metal stocks have corrected and  may resume the uptrend again. We like Sesa Goa -stop 250 target 285, Uttam Galva stop 113 target 143,  ,   Dena Bank stop 64 target 96, Mahindera and Mahindera stop 810 target 900-943 ,  REC stop 190, target 220, Natco Pharma stop 124 target 163  and Moser Baer stop 92 target 114.

Pharma stocks are trading at new high, wait for corrections to get in.

These are some of the stocks from different sector . I will take position in  cash in different stocks from different sector to diversify my risk. These are my weekly picks and I will review my positions by 3.00 Pm today and will exit from those stocks which would not move up and continue with those stocks which are performing . I do not intend to take a longer term view and may exit from all positions by the last trading day which falls on Thursday.

Patni seems to resumed ite uptrend

Patni is trading above yesterdays high of 428 . Lets us take another example Nagarjuna Construction had two down days and then

a doji formation yesterday with  a high of  146. Today its trading above 146 . The correction seems to be over with possible retesting of

157. Lets watch out how these two perform.

 

 

How do we indentify that a correction is over ??

Todays theme is how do we identify that a correction is over ?? We thought Bhart Forge would go through correction but it found support at lower levels , bounced back and closed above previous days high. Therefore, the question comes when do we buy a stock ? The best way is to buy it once it gets over the correction phase and resumes its original trend .
Lets take a real life example . Patni Computer is in uptrend . It is correcting after making a yearly high of 488. On a daily candle stick charts it has made lows on last four days. It may see some more down days -- when do we identify that correction is over and we buy again ?? Today the stock made a high of 428 and it closed in negative at 417. If on any day the stock closes above 417 with some rise in volume ie makes a green ( UP) candle we buy it. If it closes below 417 tomorrow then we do not buy it. Should we go short on it ? The answer is no . In an uptrend one should always trade along with the trend. Since the trend is up we should always look for buying opportunity. If the stock closes above 417 and Nifty remains supportive we may see the stock pulling back to 488.

Have fun and learn to trade

After Tea now its turn of Sugar stocks

Tea stocks have boiled. Now Sugar is seeing sweetness. Renuka Sugar, Triveni and Dhampur Sugar are attractive.

 

Bharti Airtel is  a safe bet for next week. This is our weekly pick . Support at 400 res at 450-480

Time to stay light

We have seen the momentum taking the Nifty to above 5000 levels. Now time has come to take atleast 75 % of your quantity off the table if you are a short term trader. Even if you are an investor it is not wise to buy at these levels. Its time to remain light and book profit and wait for the next low risk opportunity.

Bharat forge has started correcting and may remain weak , resistance is at 394 and may correct to 340-320.
I have sold October Month out of money Nifty Calls to take advantage of trading holidays and earn on time value.
We are going to have a long weekend ahead , book profit and enjoy ur weekend. I am also planning to go to some destination away from the hustle and bustle of city life.

Understanding all about Dollar

If you trade in equity or commodity market then you must have develop an understanding about the Dollar.


Lets see what Chuck Butler,President,EverBank World Markets WWW.EVERBANK.COM, has to say about some of the best books ever written on this subject


One of the first books I ever read about the dollar, was written in 1972, Gerald Krefetz, titled , "The Dying Dollar" Another book that was published in in 2003 was Richard Duncan's "The Dollar Crisis"

The Dollar Crisis was followed by two books by Addison Wiggin and Bill Bonner, "Financial Reckoning Day" and "Empire of Debt"... Addison also wrote "The Demise of Dollar", and then Craig Karmin wrote, "The Biography of the Dollar", All of these have done a wonderful job of explaining things to people that normally wouldn't understand all that's going on, financially

The reason I brought this up is that Richard Duncan was in the news last night, as he gave an interview in Hong Kong yesterday... Let's listen in to Richard Duncan...

"The bad news is at the end of a 10-year period we're still not going to have fixed the problem. Eventually it will lead to high rates of inflation well down the line and really destabilize things to the point where they may be irreparable damage. A kind of "Fall of Rome" scenario."

Of course Mr. Duncan was talking about the U.S. Budget Deficits, which he feels will continue to pile up in the next decade, eventually reaching an unsustainable level that may result in an economic collapse...

I think it would behoove us to listen to Richard Duncan, for in his book, "The Dollar Crisis" published in 2003, he told us that persistent Current Account Deficits by the U.S. were creating an unsustainable boom in global credit that was destined to break down, resulting in a worldwide recession.

Reproduced from the News Letter of Chuck Butler

Tea stocks rise

Tea sector is moving up after consolidation.

Tata Tea has support at 890 and resistance at 990.

Jayshree tea will see action above 290

PSU banks are showing momentum

Vijaya Bank has resumed its uptrend support is now at 44 and resistance is at 55-60

Do not fight the trend

Markets are in strong uptrend and most of the retail traders have the temptation of going short on Nifty. As a trader one should not flow against the flow. One should be in tune with the market.
Global markets are showing strength.Dollar is again going south and commodities are firming up. In US, Street expectation is that the Fed will leave its target range for the federal funds rate unchanged at 0.0 to 0.25 percent, although analyst will be keeping a close eye for any indications of future rate hikes.Intel Corpn has announced that personal computer sell is picking up.

Tomorrow we may see action in HCC with supports at 115 and res at 160 and RPower with support at 165 and res at 190.
Our weekly picks Tata Motors and Satyam Computer has done well today . You should exit from these two on Friday.
BTST trade India Info Line and Rolta are expected to do well tomorrow , if u have taken any position you should exit by 10.15 Am.
As long as the momentum and trend is up take every dip as buying opportunity.

Rolta and India Info Line shows strength

Rolta and India Info Line shows strength and are good trades for BTST

IVRCL - Breakout

IVRCL has broken out of  a range stop is 360 target could be 450-480-500

Global economy is on recovery path

Nobel Winner Krugman Says ‘global economy is on recovery path'.

You can read abt it

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ap6aPBj59zLc

At present rise of dollar is putting pressure on commodity price. On Tuesday one should stay away from Tata Steel, JSW Steel as these stocks may see weakness.

Bharti airtel has moved out of narrow range with good volume 418 is suport and 480 is resistance .If Bharti is able to move up then one should also go long on idea as this stocks has corrected and the uptrend is expected to resume with stop of 72 and resistance of 84.
Shipping sector saw action on last Friday ,Ge Shipping, MLL and Essar Shipping may continue with the uptrend .
Pharma stocks also saw action on Friday. Cipla seems to have corrected and 250 seems to be a strong support.
On weekly time frame Mahindra Satyam and Tata Motors are good trades

Sunday thoughts

Dr Brett Steenbarger has posted some quotation on his blog . These are pearls of wisdom for traders .


http://traderfeed.blogspot.com/2009/09/quotations-success-and-failure.html


Have a nice weekend ahead.

Markets are expected to remain subdued

After the run up and looking at trading holiday on next Monday we expect the market to remain subdued. Prism cement, 3 I Infotech, Essar Oil , Navneet Publication looks interesting. Cement sector as a whole will move up if we see follow up buying today. RIL will weigh heavily on Index movement . We may witness some bouts of volatility ahead of the expiry.

We would advise you to book profit on your long position today by the end of the day.and have a nice weekend ahead. Relax and read during the weekend and start afresh from next trading session.

Will we move to new high ???

Well, its almost have been a year . A year before we had the financial meltdown ,the Lehman Bros.collapse, and credit default swaps, and Gov't bail outs and  announcement of Stimulus package all acorss the globe by Government. Now everybody is talking that the worst is over. Are we really come out of woods ?? Just for your information Japanese Index Nikkie  made a high of 38900 in year 1990 and today its trading at 10300 . Real estate bubbled had an adverse impact on the economy. And do you know  that the Japanese introduced 11 different stimulus packages worth 30 Trillion yen? The Japanese thought that rescuing bank and  making concrete river bed will put economy on track but they were wrong . The country has a huge debt and people are saving more and consumer spending is not picking up.US ans all global markets surged up on the back of some encouraging economic data particularly about increase in consumer spending  but how long is it going to sustain ?? Unemployment is a  big concern and as people are unsure about future they tend to save more and do not spend .

 All this has been nicely highlighted by Bill Bonner of .www.dailyreckoning.com
You can read about it in detail  http://dailyreckoning.com/the-credit-cycle-has-turned/

One should just keep this simple things in mind as  media talks about Nifty going to 5500-5700.

Some action

Yes bank, 3 I Infoteck, FSL are seeing some action with good volume

Book Profit - Dena Bank

Dena Bank has had a nice upmove. One should take profit on 75 % quantity.

Thanks for your feed back

Yes, Fahd they have done well  and not to forget Renuka . Thanks for your feed back.

Learn to trade well is  the objective of this blog. keep on learning .

Time to take money off the table

Markets are in   a  frenzy some of our recommonded stocks have done exceptionnally well. Orchid Chemical which we recommonded earlier had a dizzy run. Now time has come to take some money off the table. Use this rally to get out of  Realty stocks.
For today one can go long on Bajaj hindustan with  keeping in mind 170-175 as support zone  and 220-235 as resistance zone. There are still short positions in  this stock and short covering may proppel this stock to higher levels.

A breakout on Nifty

Today Nifty was able to trade out of the narrow range it has developed for the past one week. Jindal Steel and Power, Welspun Gujrat, Patni Computer and Suven Life Science are very strong on charts and one can even make a short term portfolio of these four stocks. The risk takers can also go for Adlabs Film and DLF.Book profit on this portfolio when Nifty trades around 5200.
Dollar is expected to remain weak and this may lead to more FIIS inflow to our markets. It seems that earlier Yen was used in Carry Trade now Dollar may be used for Carry Trade.
As long as momentum is strong remain long and reap the profit.
Happy trading

Berger paint has corrected

Berger Paint seems to have been corrected and resumed uptrend. Support is at 50 and target could be 75

Stay where risk is low

Nifty is still trading in a range ,its wise to hide in mid cap stocks where some upside is still left.
some of the low risk opportunities are with GSPL, MRPL, Renuka Sugar , India Info line , IVRCL to name a few. Our earlier recommendations - packs from shipyards have resumed their uptrend. Keep on booking profits as they come along.

Have relaxed trading.

Are Global markets topping out ?

The US economy faces a difficult time ahead as consumers stop spending and the fallout escalates from the collapse of the commercial real estate market, economist Nouriel Roubini told CNBC.

For more details pl go through the link given below:

http://www.cnbc.com/id/32837255

Have fun!

Keep banks on ur radar

On Monday we may see some action in Banking and resources stocks like Dena Bank,Allahabad Bank and Gujrat NRE Coke . Nifty is still in uptrend and dips should be used to buy these stocks.

The Psychology of Trading by Brett Steenbarger

Here I am reproducing a note by Brett Steenbarger on trading
http://traderfeed.blogspot.com/2009/05/trading-and-training-of-will.html

"Without freedom there is no trading. Trading is a celebration of economic and political freedom. Slaves are traded; they do not trade.

All this freedom, however, is for naught if we, ourselves, are not free. It is the deepest of ironies that we experience greater freedom--far broader potentials--than those who came before us. And yet, in our lives, in our abilities to master ourselves, we are no freer. Amid opportunity, we remain partial: tethered to our conditioning.

What it means to be free is to be able to choose, to live with intention. The free life is one that we guide: a life lived with purpose, direction, and meaning.

Trading, like all the great performance activities, is an opportunity to cultivate the intentional life. Pursued properly, it is a path to freedom."

Risk gets higher as we move higher

Its time to take money off the table when going is good. I am off for a weekend therefore, will not be able to dwell on Nifty except the note that wait for dips to enter.
Berger Paint is buy only if it is able to trade above 62-63 for a tgt of 75. Dhanalaxmi Bank has made a new high and its a buy near 130 and if markets are supporting enough it may see more upside. Be light with your long position.
Have a nice weekend and spend some of your trading profit .

How to trade Gold

It is interesting to read this article

http://online.barrons.com/article/SB125244951610193849.html

Time to get out of trash stocks

Traders and Investors should use this rally to get out of trash stocks particularly from Realty Sector.

Focus on Individual stocks

Well, Nifty is forming a base and Dollar has again fallen and made a new low of the year. This will give commodity some boost but one should not forget that it will bring some inherent risk to equity market also and soon equity market may follow the course taken by dollar.
At present there are no apparent sign of any weakness therefore, one should ride the move and mint money.
Tea stocks have started moving up after the correction and so are the shipping stocks.Harrison Malyalam, Mcleod russel, Jayshree Tea , Assam tea , ABG Shipyard and Bharti Shipyard are some of the stocks one should buy

Our stocks do well

A very short note- falling dollar helped all three recommended stocks Sesa Goa, Sterlite and HOEC to do well today. HOEC closed with hitting upper circuit.

Nifty may form a base here

After breaking out of the broad range of 4350-4730 now Nifty may form a base here. Yesterday Cement and Sugar sector had the initial start but follow through buying was not seen. Dollar is coming down sharply and this may augur well for commodities stocks like metal, oil and gas . Sesa Goa may see some action along with Sterlite and HOEC.
but do not rush, wait for dip to buy.

Cement and sugar sector is back

Tata Chemical has moved up. Cement and sugar stocks like India Cement, Triveni, Balrampur are back into action again.

Where do we go from here ????

Nifty has broken out of the range of 4350-4730 . This breakout may be a false one but if Nifty is able to sustain above 4650-4700 we may soon see it touching 5000-5100. One should wait for the dips to go long on Nifty.
Godrej Industries , Tata Chemical , Shanthi Gear, Thomas cook and EKC are looking strong on charts . Our yesterday pick India Bull Real Estate has also done well.
In this frenzy one should not forget about the global market. We will be able to move up only if we get support from global market and things are not rosy there either. So watch this space and have fun in your trading.

Nifty is still in a range

Nifty had a positive closing on Friday on account of short covering and some value buying on the back of good global cues.Nifty is now approaching the upper band of the range 4740-4750 is a major resistance area and it will require lots of efforts to get past this level. If global cues remain supportive then only we may see Nifty trading above 4750.China still remains a concern.
Individual stocks is the place where action would be taking place. Some of the stocks have corrected and gain started their upward journey.
Voltas, ICSA and Petro Net have resumed the uptrend. KPIT Info system , India bull real estate are also poised for an upward move.
Gold is now trading at the upper end of the range if its able to trade above the key resistance level of 16000 then we may see it going all the way up to 18000.

Trade in Individual stocks

We have been of the view that one should stay away from trading in Nifty futures and should focus on individual stocks particularly mid and small cap segment. We may see action in Mid Cap textile stocks like S. Kumars ltd auto ancilliary like Motherson SS and small tea stock like Assam Company. These stocks have corrected and are resuming their uptrend.
We had earlier expressed our view on Alok Industries and Arvind Mills. They are now back into action again.
Our caveat is take small position in one or two stocks and be quick to take money off the table.

A pull back is expected

After the hammering of global market for the past two days a bounce back is expected. US market will watch for the job data to be released today and analyst are expecting improvement in jobless claim figure.
Coming back to our market we prefer going long on Orchid Chemical, Polaris Software and Rec Ltd . If Nifty is able to sustain above 4580 then Ranbaxy , Bio con Ltd and Natco Pharma may also see some action on upside. But this is a time when you should not too many positions . Nibble at one or two stocks with less volume and be quick to take porofit in time .

Use the dips to buy those stocks which u missed

These dips will also provide you opportunity to buy those stocks which have run up like Sasken Communication.Tea Stocks are also buy on Dip. Of late Gati, sical and Aegis Logistic have also shown strength

Time to go short

We have already told you two days back that global markets were showing topping out pattern and signs of crack and we also stated that Oil and commodity will remain under pressure. Well, now time has come to go short on Tata Steel, DLF, HDIL, Sterlite, Jsw Steel, Axis bank . Remember we have had a 80 % rally from the lows of March 2009 . These rally are not even witnessed in secular bull market within such a short span of time. And we are still not into a bull market yet.
As we have posted on our blog that market has already trapped the longs and its heavy on long side. The unwinding of long positions will give you enough fuel to remain short. Now instead of buy on dip its time to short on rallies.How soon sentiment changes ?? Well, thats what market is all about. Do not take anything for granted . There is no easy money to be made .

Nifty is still in range with downward biases

We have been of the view that the rally may fizzle out soon and Global markets are also showing topping out pattern especially as we head into September, historically a rough month for the stock market.Metal , Oil will remain under pressure but Mid Cap will be place to hide.
REC has again broken out of a range. Sugar stocks has shown resumption of uptrend after correction. Textile stocks are also strong on chart. Arvind Mill, Balrampur Chini REC are safe bet.

trading as a job and how to hadle fear

Trading is a process which evolves through lots of practice. Money management, descipline and a system are essential to become a successful trader. Once you are into your comfort zone it becomes fun.
I am passionate about my trading . Choose a job you love, and you will never have to work a day in your life- Confucious
Coming to handling of fear I am putting an article by Ron Wagner of Pristine.com rwagner@pristine.com
How to Handle Fear
Have you ever felt the inability to pull the trigger to get into a trade at the right moment? Then chased the stock only to your detriment? Have you ever taken profits way before your target because the stock merely "jiggled," only to sit on the sidelines, watching your stock run to its original target? If so, you are experiencing the effects of fear. You are not alone.
Psychological aspects make up 85% of the trading equation. Fear is one of the aspects. Ideally, we would all be "emotionless" traders. No fear, no greed, just pure discipline. While this may be a worthy goal, not many can take the leap to this level just because I say you need to. While most people cannot eliminate fear, there are some things you can do to keep it in check. Here are some suggestions.
1. First, the greatest enemy of fear is a well-laid plan. Have a trading plan that you use that clearly spells out what strategies you will play, how many shares you will play, and how much money you are willing to lose on a single trade. There are many aspects to this plan. These are some of the basics.
2. Next, plan out the individual trade. When you see a trade come up that fits into your plan, study the play to find the proper stop loss and target. Play the proper share size so a stop out does not violate your maximum loss per trade. Make your decisions before the trades hits while you have a clear level head, and then follow the plan without question. You must "execute" properly the trades you have "planned."
3. The next step may be the most important. Let your plan go to work. Let the play finish. Unless something changes about the trade, let it come to its natural conclusion, either the target or the stop. Think about it. You have planned a trade while you had a clear head. You believe the trade is worth your hard earned money. Give it a chance to finish.
4. There are sometimes reasons to end the trade early. Perhaps there has been a change in market environment. For example, you might be long in your play and the futures just took out key support. Or maybe you planned on reaching the target by reversal time and it is almost at the target with the reversal time now here. You may use 'bar by bar' analysis (taught in our Trading the Pristine Method Part 2 Seminar) to judge an early exit. However, these are the minority of times. The vast majority of times you should leave the play alone. Especially if you have chosen as you should the highest of quality and probability trades. Do not be jiggled out by your Level 2 screen. The chart pattern is by far more important.
5. If you are still so nervous that you can't handle it, try this next. Sell half the position at an appropriate reduced target. Get use to taking partial profits and this will let you have confidence letting the back half hit the target. This will also be likely to put you in a 'no lose' situation with the trade, giving you some patience. Good traders sell incrementally, on the way up all of the time.
6. If that does not help, then you need to cut back on your share size (or find a trade with a smaller stop) so the size of the potential loss does not trigger your "pain factor."

Where is Dow Jones headed ??

Sometimes one should know the other side of the coin.Please go through the link:

http://jessescrossroadscafe.blogspot.com/2009/08/us-equity-markets-look-dangerously.html

Its Buy on Dip , the risk is higher now

On Friday Nifty has made a new high and was able to trade above the much hyped resistance level of 4731. But we should not forget in this Frenzy that Nifty has gained more than 80% from March 2009 low and this breakout may fool and trap those who went long on this breakout. The risk is higher but now and market is heavily loaded on long side. US and China markets are showing signs of crack. It’s better to stay away from Nifty for time being.

Individual stocks particularly from MID Cap stable will see some actions in the coming week .ICSA, Rolta, Patni Comupter, Exide, Shanti Gears, Graphite India , Berger Paints , GMDC and Ruchi Soya are some of the stocks you should keep on your radar for going long in next week. But you should buy half of your normal quantity.

Mphasis is on new ground

We have posted on our blog of 9th August about Mphasis. It has moved 11o points since then . On every dip its a buy.

Nifty may retest 4730 and a breakout may see it above 4800

Nifty has come out of the short term downtrend after touching the lower band of the range. The upper level of this band is 4730 which Nifty is expected to breakout backed by firm Global cues. Mid Cap IT like 3 I Info, Rolta, Polaris , Sasken , Mphasis are poised for further upmove, Mid cap Pharma like Orchid has also broken out of the range. Tea stocks are also showing strength on charts.Old CG stocks like Punj Lyod, Welspun Guj and Voltas are also poised for further breakout.If 4730 is taken out then we we amy a lot of frenzy in these stocks. Watch out Neyvelilignite and REC.Rec is trading in unchartered terrotory and may see 250-270 levels.

Time to take profit home

The Global rally would result in Nifty retesting the key resistance level of 4730. We had suggested to buy Auto, Sugar and Mid Cap IT stocks on dips. Now its time to take money off the table and wait for another dip .

Technical view on Chinese Market

Is the chinese growth story over ??
This link gives some technical insight.

http://online.barrons.com/article/SB125050578543736561.html

coming back to our market Nifty is ranged bound with a broad range of 4350-4730. Mid Cap IT is the sector to watch along with Sugar sector.

time to buy auto stocks

Markets seems to be getting back to retest the recent highs. Its time to buy Hero Honda, Maruti and Tata Motors as they have had a very sharp correction and are on the verge of a gaining the upward momentum again. The sector is again coming back in top gear and pick up up the speed soon

Expect a bounce back on Monday

Global markets had a smart recovery led by Dow Jones. Most of the market participants went short on Friday; strong global cues will result in gap up opening on Monday. Trapped short will fuel the momentum up. From IT sector-Mphasis is poised for further up move, Auto sector, Sugar Stocks may see a strong recovery. Bharat Forge , Andhra Sugar, Dharni Sugar , are showing strength on charts. If global cues remains favorable we may see Nifty scaling past 4731 and chances are it may retest 4800-4850 - a key resistance zone.

Is China story over?

Nifty has been trading in a narrow band of 4617 -4731 for the past three days. A breakout/ breakdown from this range was expected. Today Nifty failed to trade above 4731 and plunged sharply to close below the lower range of the band. Going forward a lot will depend on global cues as there are no domestic triggers to take Nifty above 4800-4850 at least in short term. Metal, IT, Auto the sectors which were the leaders today saw exhaustion.
Talking about Asian Tigers it’s interesting to read this article:
http://online.barrons.com/article/SB124944593950307091.html?mod=barrons