Nifty Weekly View and Trading Ideas

Dear All,

Nifty has completed 12 Weeks of Weekly Positive close and May Series posting a Mind Blogging 25% Return Highest in any Series So far.So what's Next Will 13 Week Prove Unlucky to us?? Time will only tell.

In many Respect Next Week is quiet interesting if seen from trading point of view As as mentioned in last week Nifty Analysis Longs should only be initiated above 4320 Levels and see we are up almost 120 Points from 4320 Bull's Eye.

Now we face resistance at 4510 which is a citadel (Recent High on Tuesday) 4649 (AUG-08 high) and 4789 which is 61.8% retracement of the fall.

Longs should be taken above 4520 if it crossed and Sustained.I belive the Elcetion mandate euphoria is over and we will trade wrt to Global cues.

SEBI has again Reduced the Lot sizes in F&O.I have uploaded the sheet under download Section.Take a Look

Stock Specific

Dhan Laxmi Bank buy around 103-106 tgt 121 130 sl 96

Praj Industries Stock closed above and took support at 5 EMA on Daily and on Weekly charts closed above 55 EMA Can be taken at 105-109 sl 96 tgt 120 127

ABB has shown Flag Patterm Breakout and closed above 200 DMA on daily charts,Can see 675 700 Sl should be 630 levels

Cairn India is rallying on the back of Crude rally Now it has shown a negative divergence on RSI can be a good short at highs Keep an Eye on crude also before shorting Levels to be watched Resistance at 241 246 252 and support at 230 221 210

BGR Energy above 349 sl1.5%

Nifty intra day levels will be updated in Chat Box before 10.10 and 1-2 Intra day calls will be updated in the Chat box

Regards,
Bramesh


Trade with trend and Levels Do not try to predict the trend.

Nifty Levels for 29-May-09

Nifty has expired the Series with a massive gain of 25% Now whats up for Next series

Well let me update you all with the Nifty levels for 29 May and june View i will update in my Weekly View of Nifty


Nifty as it is easily Visible on charts has formed a good support at 4295 Today So if Tomorrow it breaks 4295 and sustains below that for some 5-10 Minutes go short with a target for 4292 4279 4254 4229 4215
and on upside if it crosses 4376 4415 4434 4445 4452


For Stock Specific Levels just download the Automatically Updating Excel sheet.


Regards,
Bramesh

Technical Analysis of GAIL

GAIL India is facing a trend line Resistance of 289 Once it crosses and Sustains 290-291 for a tgt of 295 and 300 Keep SL at 281.2

RSI -2 @68

ADX14 @26

Nifty Ready for Bounce????

Click on Image to enlarge

Go short in Nifty once 4050 is broken

Pivot levels for Tomorrow
R1- 4217.5 R2-4318
S1-4053 S2-3991.2

STORY OF THE US DOLLAR – A TRAGEDY IN MAKING?

When the UPA Govt took charge, the stock markets surged and so did the Indian rupee vis-à-vis the US dollar. And after a run up of almost over a week, the rupee slipped yesterday. And even today, the rupee depreciated 24 paise to 47.52/53 a dollar in the early trade. The word on the street is in the short term, the rupee will remain weak but in the long run, after August – September, once US stops buying its own Treasuries, the rupee will once again show some strength through the year. Though there are various versions saying that the money pouring into Asia has now cooled off, with some blaming this rupee fall of yesterday on the North Korea nuclear test, which is scaring off everyone from investing in Asia. Now that’s too far fetched a reason but what really ails the rupee?

To understand the behaviour of the rupee, one has to keep an ear to the ground and watch out for some key international happenings. India can say that it is decoupled to a large extent when it comes to the stock markets, what with Indian economy being more resilient and all. But the movement of currency is necessarily dependent on international happenings. So what are the key things which could dictate the movement of the rupee?

US Rating downgrade?

Standard and Poor’s has put the U.K.’s Sovereign Debt rating on negative credit watch. This has raised fears that the ratings of US might also be downgraded as both US and UK have more or less followed the same policy of injecting billions of dollars into their economies by buying assets from banks. A downgrade in the rating would not bode well for the US economy which could weaken the dollar, if and when it happens.

It is unlikely that US or UK would be downgraded but surely will be put on a credit watch. Why? Because tinkering with the dollar, which is the global currency could once again send the entire world into a tailspin. India’s rating was downgraded by S&P on concerns of mounting fiscal deficit. But downgrading the US is not so easy. Hence it will not happen. No one, be it Moody’s or S&Ps or Fitch; no one would have the courage to downgrade US. The fear of another recessionary reaction worldwide is enough to keep these rating agencies from being proactive. So downgrade seems ruled out but being put on a credit watch seems more likely.

Ballooning deficit of US?

If we in India thought we had a problem with our fiscal deficit, take a look at the figures of US. Big deficits mean the government has to borrow more, which could put its credit rating at risk. They can also put upward pressure on inflation, thus cutting the purchasing power of the dollar.

S&P has presented a report wherein it has stated that debt in the U.K. could hit 100% of GDP in the near term. IMF released a report in April which stated that U.K. debt load will be at around 67% of GDP compared to 70% for the U.S. and 69% for the Eurozone. So clearly, the highest debt risk weighs on the US.

Why eye on US economic figures?

Now all these assumptions of deficit estimates are made on the basis of economic estimates like GDP growth rate, unemployment and these have not been too good in reality. In the first quarter of 2009, GDP was at - 6.1% and as against this, the estimate for the deficit is based on the assumption that the GDP growth in 2010 will be 3.8%. Unemployment at the end of April was at 8.9% while estimate is at 8.8% for entire 2009. So based on this, we now need to keep an eye on the figures of unemployment and growth rate of US GDP as it will indicate whether deficit would go up further than estimates or be around same levels.

So from whom will US borrow?

It is not like borrowing money directly as we do from a bank – how this works is that countries buy the financial securities issued by the US govt. Hence when we read news of China, Japan buying US Treasury it means US is actually borrowing. To now get over this deficit, US needs more money, the estimate is borrowing to the tune of $1 trillion by September. The government has said it will need to borrow $2 trillion, or 14 percent of the country's total economic output, in 2009 alone. The Federal Reserve will be buying back $1.5 trillion in mortgage and agency debt issued by Fannie Mae and Freddie Mac and is making direct purchases of U.S. Treasury bonds to the tune of $300 billion. This week the US Treasury is selling up $101 billion of fresh government securities.

China has purchased $23.7 billion dollars of US treasuries bringing their total to $768 billion. 70% of the estimated $1.95 billion dollars of China's reserves is in US treasuries. With countries not having enough to buy more from the US, the US Fed now plans to buy back mortgage- backed securities to the tune of $1.25 trillion this year. The Fed is in the process of buying $300 billion of long- term Treasuries through September. So this means that the dollar will remain up, at least till then.

Story in the long term?

With more and more money getting printed and pumped into the market to buy back these securities, it is estimated that more money supply will get more money into the hands of people, who in turn are expected to spend more. Right now, no one is really spending but once they do start spending, money supply will be more than the goods and that will lead to inflation. And at that time, to control the inflation and curb money supply, interest rates would have to be hiked and securities will have to be sold. When so much gets sold, the value of money will go down. And if China is one of the biggest buyers today, won’t it sell when the value goes down? So at that time, all would sell dollar into their currencies. And that is the time when US will have to come with another rescue plan to stem the crash of the dollar and thus save the world, as they do in all Hollywood movies!

Jet Airways Technical Analysis

Jet Airways is stuck in 2 parrel trendlines and is unable to cross 316.6 Once it crosses that with volume we can easily see 331 348 Levels keep a sl of 306 for all longs taken

Dow Jones Technical Chart with Twiggs Money Flow

Light volume on the Dow indicates a lack of buying support at the lower border of the recent consolidation. Bearish divergence on Twiggs Money Flow (21-Day) warns of reversal of the bear rally of recent months. Breakout below 8200 is expected, signaling a test of primary support at 6500. Reversal above 8600 is unlikely, but would test primary resistance at 9000. In the longer term, strong resistance is expected at 9000, with breakout not expected in the next 6 months. A correction that stops short of 6500, however, would signal a trend change if followed by penetration of 9000.

Technical Analysis of Bharti Airtel

Bharti Airtel has filled the gap which was formed on 18 May from 811 to 881 and today took support at trend line.

It took support at the Middle line of Boolinger Band

ADX is still positive indicating the trend is strong

RSI has cooled off MACD still in Buy zone

Keep all the above technicals in mind Longs can be intiated in Bharti above 820 for a tgt of 837 853 sl 785 should be maintained on all Longs

Nifty Weekly technical View and Trading Stocks

HI All,

After the Euphoric mandate given to UPA by the People of India Stock markets rejoiced and created History by hitting circuits twice in a Day.After the Historic day we were consolidation in 4167-4300 range for the rest of the Week.Now the Bears are completly white washed and probably there are few shorts in the system which is quiet dangerous as there will be no buying support for markets,I am attributing this to the Fact that market is having highest OI sinse Jan 08.

Coming to Nifty Weekly Picture

NIfty 50% Retracement from the precipitous fall of 6357.1 to 2252.75 lies at 4310-4320 Range,So fresh long should be intiated above 4320 levels for a tgt of 4448 (JAN-08 lows) 4510 (Recent High on tueday) 4649 (AUG-08 high) and 4789 which is 61.8% retracement of the fall.

Do note that if 4150 breaks we have support at 4050 nad even if that fails we are headed towards 3947 which is 13 EMA and giving good support in the current Rally.

Trade with trend and Levels Do not try to predict the trend.

Stock Specific Ideas

Educomp Solution Stock has broken Tripple Top Buy between 2680-2750 for a tgt of 2888 2920 and 3000 3200 Sl 2400 on all Longs

Fortis Healthcare can be bought with a SL of 87 tgt 120+ in Short term

TCS is forming rounding Bottom on Daily and Weekly Charts Longs should be intiated above 650 for a tgt of 830 in short to medium term. Sl of 600

Reliance can be bought near 2140 for a tgt of 2180 2310 sl 2040

Satyam has shown an Symetrical triangle breakout and can see 60,69 levels sl 50.50

Use the Pivot Excel sheet to trade it will be automatically refreshed in a min.

It is best to use the EOD day Pivots Buy at support and sell at resistance for longs and vice vera for shorts.

Core projects DCB all achived there tgts given on blog. Mid cap side lot of action will be seen in coming days

Intra Day Nifty levels and 1-2 Intra calls will be updated on Blog Chat box before 10:30 AM .

Regards,
Bramesh

Pivot Point Trading

By definition, a pivot point is a point of rotation. The prices used to calculate the pivot point are the previous period's high, low and closing prices for a security. These prices are usually taken from a stock's daily charts, but the pivot point can also be calculated using information from hourly charts. Most traders prefer to take the pivots, as well as the support and resistance levels, off of the daily charts and then apply those to the intraday charts (for example, hourly, every 30 minutes or every 15 minutes). If a pivot point is calculated using price information from a shorter time frame, this tends to reduce its accuracy and significance.

In order to calculate pivot level, we need 3 prices which are:

H = previous period’s high price

L = previous period’s low price

C = previous period’s closing price

Then calculate pivot level using this equation:
Pivot Point (PP) = (High + Low + Close) / 3

Support and resistance levels are then calculated off of this pivot point using the following formulas:

Resistance:

R1 = Resistance Level 1 = (2*PP)-L

R2 = Resistance Level 2 = (PP-S1) + R1

R3 = Resistance Level 3 = (PP-S2)+R2

Support:

S1 = Support Level 1 = (2*PP)-H

S2 = Support Level 2 = PP - (R1 - S1)

S3 = Support Level 3 = PP - (R2-S2)



For Intra Day and EOD Auto Refresh Excel Sheet Download Intra Pivots for Nifty 50 Stocks


Regards,
Bramesh

Investment Idea Sujana Towers

India today is one of the fastest growing economies with a compounded annual growth rate of 8.6% in the last three years. Indian economy, Asia's fourth largest, grew at a rapid pace of 9.3 per cent during April-June of 2007 after a 9.4 per cent expansion in the entire 2006-07.

Industry

The economic acceleration has put significant pressure on the existing infrastructure, such as power, roads, ports, airports and railways. According to certain estimates, India being the fifth largest generator of power, positioned behind USA, China, Japan and Russia is expected to surpass Russia and Japan by 2030.

However, power generation has not been able to catch up with demand growth in recent years. The demand-supply mismatch has been an area of great concern and the Government of India is committed to bridging this gap.

In order to achieve the 11 th five-year plan targets, the Government has introduced new accelerated process for awarding ultra mega power projects (UMPPs) to the private sector. The Government has already planned 8 UMPPs of 4,000 MW each and this initiative is expected to help the Government achieve the target of adding 76,000 MW by 2021.

India has witnessed remarkable growth in the telecom sector in past five years. But this growth has been limited to the urban sectors. It is only now that the telecom operators have begun focusing growth opportunities in the semi-urban and rural areas, where the telecom penetration stands at an abysmal 2% of population. This growth in coverage area coupled with growth in subscribers will drive the demand for towers and cell sites.

International

Apart from India, big growth opportunities have come up in the regions such as Africa, Central Asia, Middle East and North America. Industry experts believe that Africa and Middle East, together, are expected to spend more than US$ 20 billion on transmission and distribution.

Moreover, according to international Energy Agency, private investors and Governments will need to invest more than US$ 10,000 billion in the world’s power sector in the next 25 years to prevent shortage of electricity supply.

FUTURE

In future, in a constantly changing world, the winners will be those who can identify which of today’s developments will be important over the long term. In the next 10 to 15 years, we may witness unprecedented developments and opportunities for the towers sector.

Fast track development in the power and telecommunication sectors leads to higher demand for supply of power transmission and telecom towers and associated services within the country as well as in the neighboring countries. This makes the Company to plan to set up another manufacturing facility at coast based location in order to cater to the domestic and export market. The Company also plans to set up / acquire subsidiaries in the Middle East/South East Asia in the area of power transmission and telecom infrastructure services

Sujana Towers is ideally positioned to seize the emerging opportunities and acquire the scale of a global company. Sujana has capabilities to quickly adapt to the changing market conditions and sustain the projected growth in sales and profits.

Nifty and Stock Specific view for 22 May

Nifty after having a Historical Stat of the week has come under pressure and is bleeding from past 2 days.Now what next for Nifty

Nifty looks week below 4200 and closing below that can see more weekness and gap is also left to be filled from 3800-4200.


Nifty Pivots Support is at 4167 4123 4047 while resistance comes at 4286 4362

Take Long at support and sell at Resistance,Wait for a 5 mins confirmation to see if support is taken out or is it sustained before taking a positions

Reliance Resistance @ 2160 2206 and Support @ 2086 2057 RIL has taken support at 5 EMA chances of going up are more .

SBIN Resistance @ 1760 and 1809 Support @ 1681 and 1651

Regards,
Bramesh

S&P Technical View using Twiggs Money Flow Indicator

The S&P 500 retreated from strong resistance at 940 and is similarly consolidating in a narrow range on low volume. Reversal above 900 would signal another test of 940, while breakout below 880 would test 830. In the longer term, the bear rally is expected to fail. Twiggs Money Flow (21-Day) reversal below zero would warn of a correction to test primary support at 675. Penetration of resistance at 940, however, would give a weak (primary) up-trend signal. But readers should beware of a bull trap.

Nifty Gone with the Wind with 20%UC

Markets are unpredictable,Proved once again. UPA getting a clear mandate withotut left was game changer and the way in which the markets behaved on opening trade on Monday morning further reiterated this fact. If the UPA's win was historic and exemplary then the opening trade of Dalal Street today morning was even more historic and once in a life time move to many including me. The markets have saluted the victory of the Congress with only circuit breakers! and people watching with Awe and there jaws dropping.



And what a circuit breaker! Earlier, the markets opened for some 30 seconds and it hit the upper circuit. BSE stated that it was up 1789.88 points when it opened for trading and the NSE opened 531 points up, soon after which it once again breached the second circuit limit. This led to the halt of trading for two hours and the market was scheduled to re-open for trading at 11.55 am. And then, when the market re-opened at 11.55am, within a few seconds, the BSE was up 2099 points and the Nifty was up 636 points and that was done for the day. Trading was halted for the day!



This has never happened in the history of the stock exchange. Circuit breaker was always on account of a market crash but today, it was frozen due to a rise! And halting trading for a day due to a surge is historic indeed! To a large extent, this would seem like an anti climax; it’s like everyone was waiting to buy and but could not even put their buys onto the exchange.



As per the rules of the exchange, the circuit breaker system is applied at 3 stages of the index movement, either way viz. at 10%, 15% and 20%. In case of a 10% movement, there would be a one-hour market halt if the movement takes place before 13:00 IST. In case the movement takes place at or after 13:00 IST, but before 14:30 IST. there would be trading halt for ½ hour. In case movement takes place at or after 14:30 IST there will be no trading halt at the 10% level and market shall continue trading.

In case of a 15% movement, there will be a two-hour halt if the movement takes place before 1 p.m. And if this 15% trigger is reached on or after 13:00 IST but before 14:00 IST, there shall be a one-hour halt. If the 15% trigger is reached on or after 14:00 IST the trading shall halt for remainder of the day. In case of a 20% movement of the index, trading will be halted for the remainder of the day.

Celebrating the victory is also the Indian rupee which is currently trading at Rs.47.93 a US dollar.



It was expected that the markets would open for trading on a highly bullish note but no one had expected this kind of euphoria. This unprecedented win of the UPA is probably the market turner – from a complete bearish market it is now become a bullish market. What has happened is that people have been living in a pessimistic environment for a very long time and any good news is like a drowning man clutching at the straw for support. This political win is not a straw, it is a complete bark of wood, which could take one to the shores safely.



If one looks beyond the UPA win, the fundamentals of India’s economy and the world economy remains the same. One has to take a bullish but cautious approach to the markets now. No need to rush in to book profits as the bull charge has not even got down to the mid caps. There is a lot of money waiting to come to the market, so stay invested for now.



All eyes will now be on the new Govt which is expected to be sworn in on Friday and the event to look forward to will be the Union Budget. Till then, the rally is expected to remain bullish. But remember, once this euphoria settles down, one will start looking at individual stocks and maybe at that juncture, our market valuations would seem expensive. So tread with caution once the party is over and the hangover sets in.

Nifty Weekly View and Trading Ideas

Hi All,

UPA gor a clear mandate and Left Party are left out,A real booster for Bulls.Lot of fund managers retailers were waiting for a Golden Dip to buy but markets are supreme and have befooled us again.

Tommorow Nifty is poised to open with a Huge gap up and if 3820 is crossed which looks like we may be propeeled to 4000.Now here is the catch if somehow we are unable to cross or sustain 4000 we may see a dip.Tommorow Ckt Limit for Nifty is at 3970.Lets see if it reaches there or not

Nifty Technical View Via Chart


We are Holding 3800 CE @78 which i have asked Low risk Trader to book around 95 and for HIfh risk trader it was still open If some Traders are holding watch out for 4000 Levels or Book out as it will given almost 150% return.

Another Positions we took on Friday was 3800 CE and 3500 PE with a Total Premium of 169.This position can also be closed tommorow.


Stock Specific Ideas

Bombay Dyeing has broken out of H&S Pattern on Weely Charts High risk traders Buy around 224-232 Sl 212 Tgt 250 272

Reliance Capital Resistnace at 612 above that 631 on cards

Reliance Industries above 2018 can move to 2064 Levels

DCB buy above 29 for a tgt of 32,35

Titan above 938 1021 is on cards in medium term

Keep a Sl of 1.5 for intra trades and 2-3% on positional trades


Regards,
Bramesh

Circuits limits of sensex and nifty

Like circuit limits on individual stocks, there are restrictions on the movement of indices (Sensex and Nifty). There are 3 types of circuit limits 10%,15% and 20% limits. These circuit limits are applicable for the movement of the indices either in positive direction or in negative direction.

Trading in both the exchanges will come to halt if the movement exceeds the limits in any one of the exchanges.

If the 10% movement takes place before 1:00 p.m. then market will be halted for an hour and if it takes place at or after 1:00 p.m. but before 2:30 p.m. then market will be halted for half an hour. If the movement takes place after 2:30 p.m. then there won’t be any trading halt.

On resumption of trading after the halted period is elapsed, if the market hits 10% again there won’t be any halt in the trading. But if the market hits 15%, there shall be a halt of 2 hours if the movement happens before 1 p.m. If the 15% limit is breached at or after 1 p.m. but before 2 p.m. then there would be trading halt of 1 hour. If it happens after 2 p.m. then there won’t be further trading on that day.

Read more »

Election results – immediate likely effect on the stock market

The 15th general election has returned UPA to power. Clearly in a show of
positive selection, much beyond the most optimistic media projection, the
Congress led incumbent UPA got an overwhelming majority and are all set to
form the next government without any support from the Left parties. Also the
UPA has the option not to rely on support from any of the regional parties and
reach the mid-mark in a house of 543 MPs by getting support from the like
minded “independents and others”. More than anything else, these
developments are likely to buoy sentiments in the stock markets. Not only to
say that the stock markets would rally in the short term, but the election
results could just lay the foundation for a long term rally in stock prices, in our
view.

Market Outlook: Results are beyond the market expectation hence positive.
Since March market went up by 60% with FIIs pumping in USD2.5bn.
Domestic institutions did not participate and have been waiting for the market
to correct, anticipating a fractured election mandate to be the catalyst. With
market opening gap up – it could be 200-250 points Nifty up on Monday, with
a positive bias, DIIs have no option but to start investing as the event risk is
now over. Long only FIIs, who have been waiting on the sideline for the event
risk to pass, would also come in. GEM (emerging market) funds are 2.5% in
cash and Asia dedicated funds are 3.5% in cash which needs to be deployed.
There would be short covering – markets have puts built up around 3300-
3200 level. Next big event is allocation of ministry but the real big event would
be the budget in 3-months time.

Sector outlook:
From the UPA manifesto one could predict the coalition’s commitment to the
social and rural sectors, with emphasis on agriculture and inclusive growth.
Also the nuclear deal and Indo-US relationship would play an important role.
We conclude the following likely effect.

Agriculture/Rural/Social Sector: New allocation in these sectors benefits
companies exposed to these sectors. Stocks to watch out for are Maruti,
Bajaj Auto, Hero Honda, M&M & Jain Irrigation. HLL, Dabur, Asian
Paints, Titan would also benefit from rural sales. Bharti Tele would benefit
from rural mobility.

Commodity trading: Financial Technology

Nuclear Deal: L&T, Areva T&D, Gammon India, HCC, Tata Power would
benefit

Infrastructure: Major investments in power sector infrastructure, airports,
roads and rural infrastructures, as employment generation multiplier is high.
GVK, GMR, BHEL, Mundra Ports, IRB

Cement & Steel: Infrastructure push will generate demand for both cement
and steel. Grasim, Century, SAIL, JSW, Sterlite.

Power: PFC, PTC.

Real estate: Government would be keen to give more stimulus to the sector
employs one sixth of marginal employment. Will push for small housing,
hence SBI (reach of town B, C), PNB, LIC HF, DHFL (mortgage ticket size is
small). Real estate (DLF, Unitech, Indiabull Real Estate, HDIL).

Disinvestments : Fiscal prudence demands IPO/FPO of PSUs where
government holding is high. Entire PSU space could be re-rated.

FDI: Retail (Pantaloon), Aviation sector could be re-rated.

NELP 8, 3G Auction: Will go through. Benefit to RIL, Cairns, Bharti, Idea

Pension & insurance sector reforms: Likely hence benefits Aditya Birla
Nuvo, Max Life directly.

What can be shorted?: Time to increase beta and overweight cyclicals and
underweight defensives. Sell pure FMCG like Nestle, IT (low beta) : Infosys,
TCS, Wipro, Tech Mahindra, Pharma: Divi’s lab, Sun Pharma

Nifty Weekly technical View 18-22 May

Be ready for a Big Bang on Monday and first time in my life i may see UC on Nifty which is at 3970.

Nifty Daily EOD Charts 14-05-2009

Nifty took support @3550 and bounce upwards but unable to cross 3635

Now we face an immediate resistance @3616 which is 5 EMA and after that 3637

We have formed tripple top around 3710 levels so lets see is we are able to breach that or not.All depends on outcome of election results.

The 10 day a/d ratio has now turned up (above) while there is a drop in the % of stocks above their 10 day averages but % above 20 and 50 is almost stable just around 80%.

Technical Chart for Welspun Gujrat

Welspun Gujarat seems to be locked in a range from
110 to 118.

Today's fall was with lower volumes Also a positive divergence was visible in Win%R (14),Oscillator

So one can initiate long above 119.1 with a sl around 114.Buying can also be initiated near 109 if it opens gap down tomorrow.

Nifty Technical EOD 13 May 2009

Click on the Image to enlarge

Three phases of a bear market

Many investors may be confused whether the current stock market rally
is a bear market rally or a bull market rally. The fund managers have
voted for the bulls, while the economists are distinctly bearish. The
fund managers may have a vested interest in market movements. The
economists supposedly do not - but neither do they bet millions of
dollars in the stock market.

So I thought it may be worthwhile to revisit what the technical
analysts' "Bible" has to say about bear markets:-

The Bear Market—Primary downtrends are also usually (but again, not
invariably) characterized by three phases. The first is the
distribution period (which really starts in the later stages of the
preceding Bull Market). During this phase, farsighted investors sense
the fact that business earnings have reached an abnormal height and
unload their holdings at an increasing pace. Trading volume is still
high though tending to diminish on rallies, and the “public” is still
active but beginning to show signs of frustration as hoped-for profits
fade away.

The second phase is the panic phase. Buyers begin to thin out and
sellers become more urgent; the downward trend of prices suddenly
accelerates into an almost vertical drop, while volume mounts to
climactic proportions. After the panic phase (which usually runs too
far relative to then-existing business conditions), there may be a
fairly long Secondary recovery or a sidewise movement, and then the
third phase begins. This is characterized by discouraged selling on
the part of those investors who held on through the panic or, perhaps,
bought during it because stocks looked cheap in comparison with prices
which had ruled a few months earlier. The business news now begins to
deteriorate.

As the third phase proceeds, the downward movement is less rapid, but
is maintained by more and more distress selling from those who have to
raise cash for other needs. The “cats and dogs” may lose practically
all their previous Bull advance in the first two phases. Better grade
stocks decline more gradually, because their owners cling to them to
the last, and the final stage of a Bear Market, in consequence, is
frequently concentrated in such issues.
The Bear Market ends when everything in the way of possible bad news,
the worst to be expected, has been discounted, and it is usually over
before all the bad news is “out.”

The reader should be warned, however, that no two Bear Markets are
exactly alike, and neither are any two Bull Markets. Some may lack one
or another of the three typical
phases. A few Major advances have passed from the first to the third
stage with only a very brief and rapid intervening markup. A few short
Bear Markets have developed no marked panic phase and others have
ended with it, as in April 1939.

(from Technical Analysis of Stock Trends by Edwards & Magee)

IIP DATA – LIFE GOES ON, EVERYTHING REMAINS ABOUT POLITICS

Its politics and only politics which seems to have a firm grip on the market sentiments. At this point of time, nothing else matters. The lacklustre market is not really looking for any triggers at this juncture as it knows, nothing will work. Hence the IIP data which came in today was a virtual non-event. It was like “ho-hum” another data coming in; that’s about the only reaction evinced by the market.

March IIP was at -2.3% as against -1.2% in Feb 09’. For FY09, IIP was pitiably down at 2.4% v/s 8.5% in FY08.

The main growth was seen in electricity and consumer durables. Electricity output was up at 6.3%. This could probably be due to the onset of summer, increasing demand for electricity. Consumer good was down 0.8% but of this, consumer durables showed a very healthy growth of 8.3% while non consumer durable was down 3.6%. This also clearly means, people were buying more white goods during March, probably taking advantage of the various sales and discounts announced on account of the end of the fiscal. Consumer durable also includes automobiles and the rise in sales of cars is what was also reflected.

Manufacturing output for March was down 3.3% and that is also one cause for worry. Pile up of inventory and demand not really picking up in all the sectors keepT this figure down. Capital goods showed a contraction of 8.2%, which is also in concurrence with the falling manufacturing output.

The general view amongst the analysts is that this is probably the last of the worst. From April onwards, we should see an improvement as inventory is now under control. Govt spending has also been stepped up and hence all this could help prop up the numbers in the months to come.

All said and done, there is no denying that the market simply did not care today about this IIP data. It came and went. The market is very focussed. It has eyes rooted only on the political arena. A coalition is a certainty but what is uncertain is the hotchpotch Govt which would eventually emerge and that is giving the market the jitters. Exit Poll results will start coming in from tomorrow evening. So till the new Govt takes shape, and the market is convinced about the stability and composition of the Govt, IIP or inflation, nothing will really matter.

Complied from www.sptulsian.com

Nifty EOD 11 May 2009

Nifty has again shown an support at 13 EMA.Now we need to watch out if it hold this time or not.

One can see this fall as an gap filling as we have a gap left due to huge gap up we saw on 4 May.

Please also have a look at Nifty Range prediction Technique which i discussed few days before.

Nifty Technical View and Trading Ideas

Hi All,

Hope you all had a rocking week,All calls achieved the tgts and Option call 3500 PE also gave good returns.

Previous Week Trading Stratergy

Now coming to current week now Nifty is facing strong resistance at 3720 Levels and finding it difficult to cross but good thing what happened last friday the levels of 3585 did not broker and we saw a good recovery from that low.Now we have to see if 3720 breaks and we see 200 WMA which stands at 3770 levels.




Stock Specific Ideas

SBIN Long can be initiated above 1332 for a tgt of 1340 1348 1357 1364 1375 1404
Short belwo 1306 for a tgt 1288 and 1276.

Bharti Airtel if it breaks 753.4 Short for a tgt of 739 and 723 and if does not longs can be intiated for a tgt of 784 800.

WWIL buy at cmp 15.5 sl 13.80 tgt 18

Kolte Patil buy at cmp 30 sl 28 tgt 35 and 37

Intra day calls are updated on blog before 10 AM Nifty levels and 1 -2 intra day calls will be updated with support and resistance So keep yourself tuned with blog for gains.


Regards,
Bramesh

Nifty Weekly Technical View 11-15 May

Hi All,



3819 Is a Strong resistance as of now coz it is a 38.2% retracement of fall from 6357 to 2252.75.So longs are advised only above 3820.

Nifty Trading Diary

Hi All,

Hope you all made good profits from our Nifty Intra Day Strategy(Click on Link to Visit the Post)


At 2:10 3 EMA was below 13 EMA and 34 EMA Right time to enter short we entered and made good profits.

For Nifty RT Charts please Click on Link to visit

Nifty Intra Charts



Regards,

Bramesh

STRESS TEST RESULTS TO HAVE A "BEAR"ING

After the phenomenal over 700 rise, the markets have been kind of lack luster and down. People have once again become cautious, not just on Dalal Street but world over. The US markets were down yesterday, the Asian markets are weak and Europe seems mixed, heading more towards the negative.

So what has changed for the market suddenly? From the over optimistic 700 points rise why this change in psyche? On the economic parameter, for India, everything remains the same as it was two day ago. Politically, there is now mounting concern. With the counting day nearing, scheduled for 16^th May, there a small niggling unease taking shape. ‘Who will head the Govt?’ is now the biggest question in India. Marketmen are of the opinion that the chances of Congress coming to the front are strong but what matters is the kind of coalition ii makes to form the Govt. Will it be Left or the emerging Third Front? Thus political concerns now supercede the economic worries and that is expected to keep the lid on the bulls for some time now.

Another major worry is the stress test results of the US banks, which are expected on Thursday in USA. 19 banks are under this stress test scanner and corporate grapevine has it that over 10 of them are expected to need assistance. The latest news emerging is that Bank of America would need as much as $34 billion in additional capital. Wall Street is agog with news that after the stress test, it would emerge that many banking companies might need more capital, either because they do not have enough tangible common equity or are experiencing rising loan losses. Prominent names doing the rounds in need of “assistance” are Citigroup Inc, Wells Fargo &Co, Fifth Third Bancorp, GMAC LLC, KeyCorp, Regions Financial Corp and SunTrust Banks Inc. Though the regulators have said no large institution will be allowed to fail, and have pledged government funds if necessary, there is an air of guarded caution in the air.

As explained by the Govt, these bank stress tests are not like a pass or fail kind of verdict. It is more about establishing the financial health. Just as we human beings have our health check ups which indicates what needs to be corrected where and gives an indication about the over all well being, these bank stress tests will tell us about their financial health. And just as we need medicines to overcome certain weaknesses, these banks would need its medicine – more money, to nurture it back to health. The markets are not worried about any collapse; it is just unease; typical nerves one feels prior to announcement of results.

Some positive news on the USA economic front, indicating that recession would come to an end soon had emerged last week, which led to the surge on the bourses. And in India, the mood is certainly turning optimistic. Many corporate results for FY09 and Q4 FY09 are out and as per these indicators, it emerges that Q3FY09 was the worst. There is pressure seen in the performance of Q4FY09 but it is easing. The rise in sales of car sales in April 09’ has also helped boost the sentiments. FIIs, to some extent have started reposing some faith in our markets. Economically, we were never in recession, we have slowed down. And we all know it would take some more time before it gathers some momentum. But the mood is that we are not as bad off as USA or UK and that is keeping the mood robust. It is now only politics and over the next two days, the results of the stress test which would have a bearing on the market. Best to be cautious in this market.

By Ruma Dubey

Is it Bull market Rally at S&P???

Picture is more than Words.

According to a simple weekly model of the S&P versus its Relative Strength, the market is having a Bear Market Rally.

Quite simply, the last Bear Market rally did not end until our zero based C-RSI entered positive territory. As you can see in today's chart, the current strength is not close to being at a Bull Market level.

Nifty has for Evening Doji Star

All Longs should be protected by a SL of 3618 which is today's Low.


Evening Doji Star:A three day bearish reversal pattern similar to the Evening Star. The uptrend continues with a large white body. The next day opens higher, trades in a small range, then closes at its open (Doji). The next day closes below the midpoint of the body of the first day.

Buying expected in Bank Baroda once it crosees 335

NIifty and Technical stock trading ideas

Deal All,

The coming 2 Weeks will be an interesting one and will throw up many trading opportunities to for trade. Nifty is locked in a range and now faces resistance at 3520 and above which 3561 and 3637 Levels.

Nifty Technical Outlook.

I have made a new Blog http://bramesh-niftycharts.blogspot.com/ for Nifty RT charts and have described the Strategy (Click on Strategy).So please use this Blog in MArket Hours and get benifitted.My future plans are to make blog on Reliance and ONGC RT charts.If you have any other Nifty 50 Stock in mind for RT charts do let me know,I will Try to Accommdatethem.





Technical stock trading ideas

Bharti Airtel faces resistance at 760 Once crossesd can see 769 785 and 813 Levels

Reliance Intra call givem on it on last wednseday made a high of 1820.Now once 1825 is taken out we may see 1835 and 1864 levels All longs should use 1760 as SL

Tata Power showing accumulation patten on charts Buy betwwen 880-897 keep a Sl of 860 go long for a tgt of 905 and 930

IDFC above 200DMA can see 87 and 90 in short term Keep sl of 90

Happy Trading to All !!!


Regards,

Bramesh

Mutual Fund Investing Use Basic Arithmetic Before Investing

Consider fund 'X', which was one of the worst-performing funds from the markets' January 2008 peak to their March 2009 bottom.

During this period, this fund was down about 81 per cent. Then came the markets' recovery. From the low-point in March to last week's peak, this fund gained 48 per cent. This was almost the best performance of any mutual fund during this period. There's nothing remarkable about this worst-to-best transition. This fund. and others like it, is heavily invested in speculative mid-cap stocks. When such stocks started moving, these funds started doing well.

Considered in isolation, a 48 per cent gain sounds phenomenal. It even sounds as if the fund should be well on its way to wiping out the blot of the 81 per cent decline. However, the arithmetic implication of an 81 per cent drop followed by a 48 per cent rise is rather severe. The fund made your Rs 100 into Rs 19 (81 per cent down) and then increased the Rs 19 to Rs 28 (48 per cent up). Overall, it has taken your Rs 100 to Rs 28, which is a 72 per cent drop. Not so good. To get back to Rs 100, this fund will have to gain 360 per cent more. And that's going to take some doing, recovery or no recovery.

Tragically, the implication of this simple arithmetic is not appreciated by many investors. What this means is that for any non-professional investor who is putting his or her savings in mutual funds, the only sound strategy is to chase stability and not recent returns. In general, funds that have done the best during the recent good times dropped the most during the crash. More than half of the funds that are in the top quartile in recent times were in the bottom quartile during the crash. Mutual fund investors who chase recent performance generally get nothing but funds that do very well when the going is good, but wipe out huge chunks of wealth when the markets crash. The losses are so severe that it is impossible to recover from them in any reasonable time frame. It's easy to sell and buy based on the latest performance alone.

Unfortunately, this sort of investing is creating a Darwinian bias against conservatism in investment management. Short term performance sells when the markets are rising. And when they are falling, then nothing sells anyway. All investors need to do is a little bit of basic arithmetic to avoid falling into this trap.

Nifty Intra Day Trading Strategy

Hi All,

I am sharing with you a Nifty Intra day trading strategy which many trader follows in Intra day,Before sharing this i will let you know that this is one of the million trading set up and has it own pros and cons.

Strategy

Go long in Nifty once
3 EMA> 13 EMA>34 EMA SL should be below 34 EMA

Go Short in Nifty once
3 EMA< 13 EMA<34 EMA SL should be above 34 EMA

And RSI if it is above 80 and unable to make new High once can again short and vice versa for taking Long ie.RSI below 20 but this one is bit risky.

It is better to take confirmation from EMA's and RSI to make a trade that has high Reward.


Regards,
Bramesh

Nifty 50 Locked in a range from 3300-3520

As easily seen from the charts we are locked in a range and breakout on either side should be fast and furious

So it is advisable either not to trade or trade on Intra basis. Positional call should only be taken once this range is broken.