Buy when others are fearful

We have never seen such a low expectation before budget. Its going to be a non event and when everybody is cautious , market do not behave according to the general consensus.
At the worst market may remain remain ranged bound.

IT sectors stocks are strong on charts. Mid Cap pharma is another place to be in.

Have fun.

Ruchi Soya hits target

Our weekly idea Ruchi Soya has hit target. Its time for partial profit booking with trailing stop loss


Exit from what is not working and ride on what is working

Rogoff Says China Crisis May Trigger Regional Slump

China’s economic growth will plunge to as low as 2 percent following the collapse of a “debt- fueled bubble” within 10 years, sparking a regional recession, according to Harvard University Professor Kenneth Rogoff.

Kenneth Rogoff is an economist, co-author of “This Time is Different,” a 2009 book that charts the history of financial calamities in 66 countries.

You can read the article :


http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a4MydrE5VOEM

Market may break out of the range ?????

Market has been trading in a range and despite most of the negative news flow Nifty was able to sustain above key support levels. On weekly chart Nifty is also showing some sign of taking support at lower levels and resistances are at 4950 -5000.

Some of the trading ideas for the week are :

Aptech - Support 159 Resistances 194- 202-208


Ruchi Soya - Support 85 Resistances 102-110


Whirpool - Support 127 Resistances 160

How Does Goldman Sachs Make Its Profits? How fair they are to their clients and how they use trading for their own advantages.
Its intresesting to go through this . Its 15 min video in two parts but worth watching.


It will open your eyes


http://www.youtube.com/watch?v=uMc6KyM_CrE


http://www.youtube.com/watch?v=98NhoCmaMt4&feature=channel

Warren Buffett's Biggest Stock Holdings

As CEO and primary shareholder of Berkshire Hathaway (BRK), Warren Buffett, the world's most famous investor, has developed a well-known reputation of buying big stakes in companies he believes in. When Buffett buys shares of a company for BRK, the markets translate his moves as a vote of confidence for a firm's continued success.

Here is the link to see the publicly-traded U.S. stocks owned by Warren Buffett's holding company Berkshire Hathaway or its subsidiaries, as reported to the Securities and Exchange Commission of USA in filings made available to the public.


http://www.cnbc.com/id/22130601/

Metal stocks shine

Today market rallied again, second day in a row . Going forward 4950- 5020 are resistance for Nifty and a major resistance zone.

The chart pattern showed oversold conditions for most of the metal stocks and our earlier ideas Tata Steel and Nalco had done well.

Eveready has resumed its uptrend support is at 56 and resistances are at 76 /84.

You should also study the charts of Shivam Auto and Gujrat Alkali and we will wait for your comments on these two charts? What is the significance and what does this pattern tell us.
Your comments are welcome.

Cheers !

A bounce back is on the card ??

Yesterday Nifty surged up in the last hour of trading session. Going by the history Nifty may restest 5000-5020 , which is closer to 100 DMA.

National Aluminum seems to find support at lower levels. Support is at 356 and resistances are at 409-421.
Metal as a sector took a beating and apull back is expected .

Have fun.

Nifty is still ranged

Nifty is still in downtrend and broad range is 4700-4900. Market may witness a pre- budget pull back rally. But overall weakness is there.

Tata steel is getting support at 150 Dma. It has support at 520 and resistances are at 578-590-600.

As long as Nifty is trading below 4950 one should keep the volumes low.

Craving the High That Risky Trading Can Bring and Online-Trading Addiction

Daniel Kahneman, a Nobel Prize-winning psychologist, showed that individuals do not always act rationally when faced with uncertainty in decision making. When faced with losses, individuals may seek to take more risk rather than less, contrary to what traditional economic thought might suggest.

You can read this article by visiting ;

http://www.nytimes.com/2008/02/07/business/worldbusiness/07trader.html?_r=2&oref=slogin

You can also read about online trading addiction -a article published in Wall Street Journal :

http://www.smartmoney.com/investing/stocks/online-trading-addiction-the-warning-signs-9917/

We have come across many part time amateur traders burning their fingers by trading in Futures . There are some who have lost fortunes by trading in bigger quantity in futures thinking that trading in future is akin to investing.
Our aim is to warn the retail investor and traders about the perils of future trading. Hope these two articles help them in understanding that trading in futures is like playing with fire

Our Ideas work

Nifty may trade in a range before budget. It may keep its head above 200 Dma and trade in a broad range of 4650-4950-5000.

Some of our earlier ideas like JK tyres, Ajanta Pharma, GMDC,Rice Stocks/ Agri Commodity/ Mid Cap IT stocks are doing well.

Its all about identification of chart patterns from the buzzing sectors. But remember patterns do fail. This is where money management comes into play.

Successful traders always think about how much they are going to loose before initiating a trade.

Ten Core Ideas of Trading Psychology By Dr Brett Steenbarger

1) We are most likely to behave in inhibited or impulsive ways, violating trading rules and plans, when we perceive events to be threatening;

2) What we perceive to be threatening is a joint function of events themselves and how we think about those events;

3) A key to gaining control over trading and maintaining consistency is to be able to reduce the threat associated with market events and process adverse outcomes in normal, routine ways;

4) We can reduce the threat associated with adverse market events through proper money management (position sizing) and through proper risk management (limits on losses per position);

5) We can reduce the threat associated with adverse market events by training ourselves to respond calmly to adverse outcomes (exposure methods) and by restructuring how we think about those outcomes (cognitive methods);

6) Optimal skill development in trading will occur in non-threatening environments in which learners can sustain concentration, optimism, and motivation;

7) A proper mindset is therefore necessary to the development of trading skills, but does not substitute for such development;

8) The cultivation of trading expertise is a function of the amount of time and effort devoted to learning and the proper structuring of that time and effort;

9) Proper structuring of learning involves the setting of specific, doable, cumulative goals and the provision of rapid feedback and correction regarding the achievement of those goals;

10) Practice does not make perfect in trading or anything else; perfect practice makes perfect. Training must gradually build competencies and correct deficiencies in a manner that sustains a positive mindset and optimal concentration and motivation.

Market may witness a bounce back

The power of 200 Dma worked out this time. Sometimes it does not work and even in strong Bull market Index do trade below 200 dma for some time and then again bounce back above it. Our markets where the growth story is intact are trading near 200 Dma and are below 150 DMa. US markets are trading above 150 Dma where the economy recovery is still doubtful.

Market may witness a bounce back on the pre- budget expectations.As long as Nifty is trading below 100 DMa weakness will persist.
The best way way to trade is trade with small quantity and add as we move up.

Shipping Corporation has support at 145 and resistances are at 167-180

GMDC has support at 136 and resistances are at 172-185

Nifty is near 200 DMA - Time to get in

Nify is trading near 200 DMA which is at 4657. It made a low of 4675 yesterday. This low is very close to 200 DMa. The old saying of the market is ' Bulls live above 200 DMa. '.

In bull market Index do correct to 200 DMa and these corrections offer wonderful opportunity to buy.Most of the investors/ traders tend to buy at higher levels while the idea should be to buy corrections. One can start with allocation of 30 % of capital and keep on increasing your stakes as markets goes in your favor. There are many stocks which have gone through 30-40 % below their peak price.
If one is able to select those stocks then it will reward them.
Happy hunting.

"Have Breakfast… or…Be Breakfast!" -who is my competitor for tomorrow?

I recently read a article by Dr. Y. L. R. Moorthi who is a professor at the Indian Institute of Management Bangalore. He is an M.Tech from Indian Institute of Technology, Madras and a post graduate in management from IIM, Bangalore.

This article was published in "The Wall Street Journal ". Its a must read article .

The link is :

http://online.wsj.com/article/SB126465641868236415.html?mod=WSJ_latestheadlines

Sudden spurt in Farm land price

There is a news item on Bloomberg by Tonny Barett " Sell the Porsche, buy a tractor and reap returns. Farmland prices that more than doubled in England in the past decade may repeat the gains.

The average price of the land surged 164 percent to a record in the last 10 years, second only to gold among “major asset classes,” on demand for food commodities, it said.

You can read the complete article by visiting the link :

http://www.bloomberg.com/apps/news?pid=20601102&sid=a.kXOr_QXJf4

Last year Commodity Legend Jim Rogers has stated "farmers are going to be driving Lamborghinies"

Jim Rogers has started farming in big way . You can read about it ;

http://www.cnbc.com/id/29477080

Back home look at some of the Rice stocks. Soft commodity stocks like Tea, Coffee, are consolidating .You can keep them on your radar.

In International market Sugar futures are trading at life time high though our sugar stocks are not doing well. But related stocks like Dhampure speciality sugars ltd , CCL Products , Karuturi Global and zydus wellness are the stocks to watch . These have niche products in the market.You can visit their website and find out more .

Interest rate sensitive on radar

Interest rate sensitive related sector were hammered down in this recent correction. This is also a space where shorts have been built up. Short covering is bound to happen . Therefore, Banking, Auto and to some extent Realty will move up in coming trading sessions.


Tata Motor has support at 670 and resistance at 820. On charts it shows ready to resume its uptrend and may vroom up to 800- 820