What a Drama done by NIFTY :-)

Wish you all a Very Happy Diwali.

Stock trading is the toughest business to be in. one need to have lot of patience and consistency other than intense study. Market is going mad. It goes down like waterfall and runs up like rocket. Why it fell like waterfall ??? Why it went up like rocket ??? I REALLY REALLY DON'T KNOW :-( please tell me if you know. I am tired of finding out why market goes up a day and starts falling the very next day with out any reasons. But when i ask anyone why did it rise or fall , i am sure that he/she will have answer. And I always get the answer but always different answer from everybody and i get more confused :-( 

Now talking seriously about the current market condition, it is difficult that we would be able to get into positive trends. The companies are under immense pressure to perform, there are expected job cuts in market which could bring people more into saving mode than spending mode. Lesser demand will bring the  companies under more pressure. Commodity market is also under bear mode, too add more to it, the rupee is weakening more and more. To some of my friends when i say that $ would touch 70+ w.r.t Rs in a year or so they say Vipin your are mad. Every one says 50 is the high and it won't go beyond. I don't know if I would be 100 % correct but I think because of the $ being so valued entity and every country is invested in $ in is some or the other way for Oil trading or for hedging or for imports/exports anything, it is in some way or other connected to $ investment. Now because of very bad credit crises every body wants to liquidate their investment in $ and thus every body is buying the $. This is the reason I think for $ rocketing to sky in spite of the facts that there are credit crises going on globally. $ is getting stronger against each and every currency. I feel that $ and U.S. market both will rise from here on.

coming to Indian market now particularly NIFTY the target of Fibonacci 61.8% levels (2428.4) was achieved very easily and we went far below that and covered back quickly. Rapid movements in NIFTY caught people on both sides. few smart one as always earned on both ways as well. The next NIFTY levels which is unpredictable for me. My view is we will keep jumping up and down for quite some time now. Don't be over leveraged and be in safe and long term good quality stocks only. Here are my suggestion for few long term stocks(click here).

"Infinite money is available to a mind that is ready, willing, able, qualified and gives itself permission to earn and accept it."--Mark Victor Hansen

Nifty Views

As I said in my post "learning from mistakes" about the Fibonacci levels of 3117 (50% retracement), we took support at those levels and  reversed from there only fibo level were 3117 and yesterdays low on nifty future was also near about same level.So is this the bottom ??? To me bottom would be when we stop testing the bottom again and again. Right now as i said earlier also lets take each step at a time 3400..3600..3800..4000. These are very very optimistic figure for any body in short term trading. Beyond this no optimist would be thinking as of now.I feel that we will go down once again after the rally to test the 3000 figures and then we would finally start the new trend.

Let's take a look at yesterdays 5 min chart now.

Looking at the Yesterady five min chart there was a clear Divergence and along with that the MACD gave positive cross over and RSI were also giving the buy signals, I didn't dare to buy as last few times i made mistakes in haste but paper trade and that was an absolutly fantastic trade. It gave a rally of 200 pt from my by buy levels (bought at 3130). Divergence always gives good results this is what i have read in most books. Percent of success is also very good in divergence says few good TA's.

please take a look at the few companies in my post (click here) which are good fundamental buy and also long term buys. I feel that these companies should be the aggresive buy when we test the lower levels next time. If we dont break the current bottom levels by good margin then that would be the bottom or else 2006 bottom level that is around 2800 levels can be support if that is broken then last would be our next fibonacci levels 2450 approx (61.8% retracement)

For now we are in a pull back mode, all bad news left to come are already discounted by the market I feel. Be cautious trade small quantity, be happy with the small profits. 

Wish you all the happy trading.

"Life is just a blank slate, what matters most is what you write on it"--Christine Frankland

Long Term investments

Got this details on few companies through Friend ..putting it up so that everyone get benefit from it.

L&T
L&T has done engineering, procurement and construction projects for nuke power plants. It is currently working on the 2,000 MW Kudankulam nuclear project. The company will get into mainstream nuclear projects if the deal goes through. L&T’s talks with Toshibha failed. It entered into a recent tie-up with Mitsubishi for super critical boilers. The Mitsubishi technology would be used for Nuclear Power Corp. L&T may leverage its relationship with Mitsubishi for its other nuclear business.

LT is planning to form a Rs 2,000-crore forging venture with NPCIL. At present L&T’s reactor making segment contributes 3% to the company’s turnover and this is expected to go up to 7-10% now that the deal has been signed.

BHEL
BHEL supplies up to 500 MW of equipment to Nuclear Power Corp. It is looking for a tie up manufacturing equipment of up to 700 MW & 1500 MW. The company has been in talks with Alstom, GE Energy, Russia's LMZ and Siemens. It has an existing tie-up with Siemens for nuclear technology.

BHEL has a JV with NPCIL for manufacturing nuclear reactors and now, the signing of the deal would give this JV a major boost.

NTPC
The company is in talks with Nuclear Power Corporation of India. It is looking at setting up 2000 MW nuclear plant. He is In talks with GE Energy for technology and fuel. NTPC is looking at the project to be operational by 2012-2013.
NTPC has also drawn plans to enter nuclear power generation by setting up a 2,000 MW project. It would be easier for PSUs as there is no restriction on them.

Areva T&D
Areva T&D is looking at a plant for uranium mining and recycling. The plant would be set up after nod from Nuclear Power Corp.

Alstom Projects
The company already makes nuclear reactors and rotors. Its parent company is a world leader in conventional nuclear projects. It makes turbines for nuclear power stations. It supplies steam turbines to over 30% of nuke power stations globally.

Rolta
The Rolta-Stone and Webster joint venture competent provides reactor-building technology. It will leverage on its partner's core competency. Stone & Webster's parent has 20% in Westinghouse Electric, a nuclear reactor maker.

HCC
HCC has constructed four of seven nuclear power projects in India. It is an EPC contractor for nuclear projects.

ABB
ABB makes components for power projects. Its parent company’s exposure includes new
nuclear power plants, systems and components. The parent company’s exposure includes fuel services, waste management and decommissioning.

Crompton Greaves
Crompton Greaves works with Nuclear Power Corporation of India. It has completed a switchyard for nuclear project.

Walchandnagar Industries
Walchandnagar Industries has supplied critical components like the calandria to most of the nuclear power plants in India and now naturally be a big beneficiary.


Siemens has a marginal exposure through its parent company.

Reliance Energy plans to invest additional Rs 12,000 crore in nuclear power capacity. It plans to install 2000 MW of nuclear power capacity.

Tata Power
Tata Power has tied up with some major nuclear equipment suppliers like Areva. It already has a relationship with Toshiba;it will leverage on it.
Tata Power is looking at entering this sector either alone or in a JV once it is opened up to private utilities. It also plans to go into the business of front-end and back-end fuel cycle technology business.

Pull back in Place

As i said in my last post that we are ready for the pull back, yesterday there was the Great rally. so where can this pull back end 3600..3800..4000? don't go all long that can be dangerous, take small small longs after each hurdle is taken out keep adding more and as soon as we see signs of pull back getting exhausted, liquidate all longs. I guess we are not going to sustain this pull back for very long.

Some very good long term investment can be done in below companies. Most of these are going to be benefiting from the nuclear power investments that is being done by government. We may see these companies going down with the market but when it starts rising it will fly and you won't be able to catch it. What can be done is keep buying 10% of your target investment for next one year on every DIP.

Alsthom Projects, Areva T&D, Gammon India, Larsen & Tubro, NTPC, ABB, Crompton Greaves, HCC, BHEL and Rolta. India willing to build upto 35 to 40 civilian nuclear reactors across the country by 2020 to meet the growing power requirements by nation. There are companies like state owned NTPC which is going to be the major beneficiary along with Areva T&D and Alsthom Projects, specialized manufacturing equipment for nuclear reactors as well as service. Companies listed above are leaders with most advanced technologies in their field of services that can meet any national and international standards.

Learning From Mistakes

 In my monday morning Post i sugessted that we should buy the panic. But I think becauser I am not matured  I didn't took into the account that the US monday morning reaction can also affect us on tuesday. so the better idea would had been to wait till tuesday to see the reactions and then buy on wednesday. The fantastic buys were available on wednesday. Most of the stocks are buchered by 80-90% from their Highs. so i guess we should see the a pull back till the end of this month. After the pull back we will again start moving in original trend again. As I said earlier also that we need time to get out of this mode and it won't happen in few weeks time. According to some important fibonacci levels, 50% and 61.8% are supposed to be important retracement levels. If we have to go by fibonacci levels then

Nifty high 6357--> 50% levels( 3117) --> 61.8% levels (2428.4) , so looking at these figure it is hard to believe that we can even drop from here. As it is said that Market is nothing but a walking drunked man, so you never know where it will step next or fall next. The above levels can be used as support to go long and can even be used as your stops.

Yesterday a thought came to mind and What worried me most about the credit crunch was that if one of my cheques is returned stamped 'insufficient funds', I won't know whether that refers to mine or the bank's! :-)

P.S.-- IF you want to read more on gobal credit crunch follow the Link(GLOBAL CREDIT CRUNCH)

" If you don't design your own life plan,

chances are you'll fall into someone else's plan.

And guess what they have planned for you? Not much. " -- Jim Rohn

A Trader’s Self-Evaluation

A Trader’s Self-Evaluation Checklist By Brett N. Steenbarger, Ph.D!!!

1) What is the quality of your self-talk while trading? Is it angry and frustrated; negative and defeated? How much of your self-talk is market strategy focused, and how much is self-focused? Is your self-talk constructive, and would you want others to be talking with you that way while you’re trading?

2) What work do you do on yourself and your trading while the market is closed? Do you actively identify what you’re doing right and wrong in your trading each day—with specific steps to address both—or does your trading business lack quality control? Markets are ever changing; how are you changing with them?

3) How would your trading profit/loss profile change if you eliminated a few days where you lacked proper risk control? Do you have and strictly follow risk management parameters?

4) Does the size of your positions reflect the opportunity you see in the market, or do you fail to capitalize on opportunity or try to create opportunities when they’re not there?

5) Are trading losses often followed by further trading losses? Do you end up losing money in “revenge trading” just to regain money lost? Do you finish trading prematurely when you’re up money, failing to exploit a good day?

6) Do you cut winning trades short because, deep inside, you don’t think you’ll be able to make large profits? Do you become stubborn in positions, turning small losers into large ones?

7) Is trading making you happy, proud, fulfilled, and content, or does it more often leave you feeling unhappy, guilty, frustrated, and dissatisfied? Are you having fun trading even when it’s hard work?

8) Are you making trades because the market is giving you opportunity, or are you placing trades to fulfill needs—for excitement, self-esteem, recognition, etc.—that are not being met in the rest of your life?

9) Are you seeking trading success as a part-time trader? Would you be seeking success as a surgeon, professional basketball player, or musician by pursuing your work part-time?

10) Can you identify the specific edges you possess over the many other motivated, interested traders that fail to achieve success in the markets? Do you really have an edge, and—if so—what are you doing to maintain it?

For some of you who are not familiar with Brett N. Steenbarger, he is Director of Trader Development for Kingstree Trading, LLC in Chicago and Clinical Associate Professor of Psychiatry and Behavioral Sciences at SUNY Upstate Medical University in Syracuse, NY. He is also an active trader and writes occasional feature articles on market psychology for a variety of publications.

Buy the extreme sentiments

There was an indication by many of good TA's about the 3600 levels  & we are here now. Lot of Drama was done by nifty in last few week and as i said we need time in my last to last post so don't assume this temporary reversal which we can see in few day as the start of bull market .Right now there is extreme negative sentiments in the global market with respect to global economic recession. Buy the Extremes is what the big folks say so this is time to go long i feel.

I thought that Nifty would cover up yesterday in later half and then it would fall again today morning. But today's morning work has already been done yesterday, we breached 3600 mark and then closed at around same levels of 3600. If nifty stays above 3565 we can expect it to cover and move slowly towards the pull back levels of 4000 ( giving technical levels here ). I feel that Nifty will open slightly negative to flat today. IF Nifty opens with the big fall and does not recover quickly then  the scenario may change.

I would like to buy the 4000 Nov call at round 80-90Rs and keep the stop loss of 15 rs. From here if nifty move as thought then we can keep our Stop loss trailing and add more calls if we feel that we are in the correct trend. Remember if we open with the big fall and do not re-cover then I would not prefer to go with this trade.

Remember that there is nothing stable in Stock market; therefore avoid undue elation in prosperity, or undue depression in adversity.

Who Say It's Over

The Nifty is been fooling around common people every now and then, i guess people will suddenly become sentimental highly positive and jump in buying and the nifty will suddenly seems to be bullish and then there will be another fall, Zap boom bust. I feel people will again get trapped in the current move. Lot of people thinking the bear rally over, be aware.People say the bailout will get passed and we will have the fresh bull run now. Please stop fooling around your self if you are short term trader/investor and are going investing in bulk.Rupee is weak the American economy is also going through slow phase(Industrial output/demand down, unemployment increasing) which is not a good news. The global financial systems are going through the trouble. Lending system also needs to go through the cleaning process after the bust.How can all this be done over night. Suppose a boxer is beaten down to ground for first time he gets up quickly and starts fighting , if he is beaten down again this time it takes more time for him to get up and start fighting, suppose he gets beaten down to ground again and is beaten very badly he will try and get up but it will take more time for him to get up as he beaten down badly. He need to regain energy before he gets up. On similar lines I think after the bubble has burst it will take time for things to be back on track and run smoothly.Let be optimistic but give system the time to gain energy and don't expect a sudden steep run in market.

Also speaking according to technical charts the bull run was for about 5 years. After the down fall for just 9 months we cannot expect the market to be bullish again just because of US bailout plan. Nifty may keep a slow downward moves for few more months and then may be slowly start returning to track. And when this will happen not most people will know that the bull run has started, because people will get bored with the range bound slow movements. on the other hand it may happen that nifty keeps taking the wild jumps up and then down ,up and then down in the same range for few more months may be before it resumes the next bull. I guess may be next mid year we will see that the new bull is starting.

"Doing the best at this moment puts you in the best place for the next moment." --Oprah Winfrey

Please leave your thoughts and comments.