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Market Direction , trading setup , how you lost and how to profit

NIFTY Snapshot

Today’s Close: 7932.90 All time High: 8180.20 52 Week Low: 5700.95 Down from All time High: 3.02% Up from 52 week low : 35.82%

So as we see we are just 3% down from the top and people are crying as if market has crashed , but their crying is not without reason some(or most) are in deep losses . Reason? Definitely not a small correction of 3% ,then what ? There are multiple reasons :

  1. Most people sat on sidelines and made their positions on the top(this was definitely not all time top) and those people after booking losses will again do the same thing on some other top and in between market will be a bad place to be i for them.
  2. Even if they made positions on the all time top (say at exact mathematical top) , its down only 3% , but they make “huge” loss and the only reason behind that is their highly leveraged position . Appropriate quantity according to ones capital is never followed . On the sidelines I want to highlight the most important fact of our paid services is that I always suggest clients quantity according to every individual’s capital and that’s most important aspect of any of our paid service . A simple calculation is if you buy NIFTY by paying a margin of say 40000 on say 8100 you are leveraged 10 times and what most people do is they do it to the fullest of their potential meaning a 3% movement in their direction will make them richer by 30% and in case  of opposite direction its -30% , and in that case they won’t be able to take the next position and will “try their luck in options” .
  3. Most people want to make quick by Options ,but they are good only when handled properly . And by proper handling it is not only meant that you buy the “right” call/put , it means you buy the right quantity, and also right strike and most important even if market is bullish or bearish to know whether to go for option or not as even after good spot movement options might not perform at all . The current example is 8000 NIFTY PUT  suppose one bought on 2nd September expecting a fall in NIFTY , his/her trading direction (for small gains) might be right but that put was 80 that day and today also after almost 250 down from that day high of that put is 88 . And even if we consider extreme ,i.e. he bought that day on lowest price 56.25 (NIFTY fut high that time 8139) one can’t sell in mere Rs. 32 gain (even assuming he would have managed to sell at exact top) as in case off loss risk was that of 56.25 so its quite reasonable to expect similar returns. But on the contrary in just 2 days period if one had bought 8200 Call on 1st September at say Rs. 40 (low was 35.9 but I am picking 40 as in our paid service we had bought at that level and several trades were executed and confirmed at that level) on 3rd September the call made 84.9 but we take 80 as selling level (again reason same as above) call became double and NIFTY moved only 100 points. So the point is not to boast what I did but , whether to buy option or not and which one to buy.

There are different permutations and combinations of above three factors to make HUGE losses even in very little opposite market movement . And what our my paid service separates from the free ones is not the quality of calls but the number of calls (actually lesser than in free service and saving from above three .

Now we come to the trading setup, and further market direction . On that I have only few words to quote from Gordon Gekko : Greed is good and its time to be greedy  .

How to be successful in achieving that , again from Gordon Gekko : Buy my Service. As money can’t be made be made that easily , either put a lot of efforts of yours and and a lot of money for gaining experience or simply pay for that.

MARKET ACTIVITY REPORT ,DATA POINTS OF THE PAST WEEK AND UPCOMING DATA POINTS OF THE WEEK

FII Activity for the  Past Week

Date Cash Index Futures Index Options Stock Futures
08-Sep-14 1162 193 809 -81
09-Sep-14 479 -267 -178 -150
10-Sep-14 -9 -828 908 -759
11-Sep-14 433 33 565 -512
12-Sep-14 182 -497 -46 -637
 Total 2247 -1366 2058 -2139

India VIX: 12.3650  -0.15  -1.22% 

NIFTY PCR Current Month:1.15

Index PCR: 1.0

Highest Open Interest in NIFTY

Call : 8300(6667550) CE Put : 8000 PE(8425850)

Data Points of the  Past Week

  • July IIP at 0.5% versus 3.4% in June
  • August CPI dips marginally to 7.8%

Coming Week

  • US Federal Reserve’s monetary policy review – Wednesday
  • CPI inflation in early trade on Monday
  • WPI inflation data

NEW F&O COUNTERS IN NSE

NSE from tomorrow is adding 5 new f&o counters. Following is the list

Sr.No Name of the Security Symbol Lot Size

1 EICHER MOTORS LIMITED EICHERMOT 125
2 MINDTREE LIMITED MINDTREE 250
3 MOTHERSON SUMI SYSTEMS LIMITED MOTHERSUMI 1000
4 SKS MICROFINANCE LIMITED SKSMICRO 1000
5 TVS MOTOR COMPANY LIMITED TVSMOTOR 2000

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Maruti Suzuki

Maruti Suzuki

MARUTI.BO
(%)

Our Recommendation : Investment Buy and Also Short term bet(6-9 months)

Time Frame : 2-3 yrs

Short term buy target: 3800-4200

Long Term(2-3 yrs) target : 12000+

Any dips should be used to add this counter. But remember this is not a trading bet .

Recently launched Ciaz is going to be game changer for Maruti. Till now Maruti was leader in entry level and hatchback, but was missing the game in more lucrative( high margin) sedan segment . Further its design and and brand image always stopped buyers from shifting to the next level car which is going to change big way by Ciaz. Any car lover can say its best of Vento(safety and build quality), Honda City(elegant design) and Verna (gadgetry) and add to that Maruti service and reliability.

So it should bring Maruti to the section ,it has been left till now.

m_id_419488_raghuram_rajan

Market Outlook 5 Aug(RBI )

For all recommendation must keep in mind markets are not going to be as simple as that of Mar-May one way rally.


Rate Outlook : Though any rate cut is unexpected Rajan may bring surprise 25 bps cut in CRR/Repo Rate

Index Outlook

We have recommended buy in Bank NIFTY @15300 lvl for tgt 15550-15680

Option Bet : Bank NIFTY 16000 CE tgt 210-330

NIFTY: 7660 given earlier is a crucial pivot on closing basis. Very short term tgt 8841+ ;bias positive (from where to start will be crucial for real gains)

Stocks

PNB buy tgt 988-1033-1088

SBI buy tgt 2528-2588-2750

RelCapital accumulate for tgt 680-748-810 in coming days and keep trading few qty in declines

ABIRLANUVO hold for 1800+(Already given on twitter)

Market Outlook for Coming days

We have seen spectacular rally(Feb-June) as was told well in advance and now markets have digested and capitulated well in the last one-two months. Moving forward we are seeing decent opportunity ahead till Diwali 14 at least 1000“tradable” NIFTY points in Aug-Oct timeframe . The major difference this time will be opportunity available in Options and good volatility in commodities too. In the last run-up (feb-june election time) not much was available as “tradable” option opportunity , but this time its good for options too.

For trading the upcoming market opportunity we are offering Diwali Special package for interested candidates. For details fill your details below or visit:Diwali Special

Market Outlook July(Budget Spl)

Index Outlook

NIFTY buy range above 7660 tgt 8100-8400

There are two scenarios :

1.Pre-budget spike till 7900+ – in that case better exit ur holdings and take rest for till Aug

2.Post –budget secular rally : NIFTY holding 7660 by the time of budget and trading in range 7660-7850 will give further secular rally uptill 8100-8400 levels with stocks performing .

Stocks

CANARA Bank (424-430) buy tgt 488-522-580

JPASSOCIAT (66-68) buy tgt 84-105

UNITECH (28-29) buy tgt 38-44-48

RELCAPITAL (600-610) buy tgt 680-748-810

 

Serious traders may join our profit share service . No advance

For Details mail to valuecm@yahoo.com WhatsApp(only): 9431813147

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Election Special Mkt Outlook

Hello !

Hope you people followed the warning I gave ( https://www.facebook.com/photo.php?fbid=609781549059215&set=a.145866655450709.21344.117265118310863&type=1&fref=nf ) on our FB page and Twitter .

Now the time has come for using the energy conserved.

Our Market Outlook For till Mid-June :

Index Outlook :

NIFTY Positional Buy in 6175-6275 range with tgt 6800-7200-7700 SL closing basis 6100.

Though our target seems exorbitant it is yet to be seen that even after achieving the targets ‘option buyers ‘ esp Index Option buyers will make same kind of money as that of future . Our inclination is that “this should be future traders market rather than option traders “ ; though this is prelim expectation which might change but still even after having bullish outlook with huge movement expected I suggest cherry picking options and better go with stock options rather than index options.

Those planning to buy just b4 election results might be disappointed this time as its not 2009 its 2014

Few stocks selection :

· JPASSOCIAT(38-40) buy tgt 54-66-74

· UNITECH (11-12) buy tgt 17.5-22-28

· ADANI ENTERPRISES (250-260) buy tgt 288-360-480

· SBI (1475-1520) buy tgt 1788-1920-2220-2600

The list is long and for those who are serious to play the upcoming ride may join our election special : http://valuecm.com/elections14.htm

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Markets ready for a steep bounce

Friends,

Writing after long break as THERE IS A DECENT OPPORTUNITY I am seeing in the markets after the current meltdown.

NIFTY Outlook:

Major Support at: 5248 Buy NIFTY or 5400 Call Aug with stop @5248 for target 5460 – 5548

Stocks to Buy : Tata Steel , HINDALCO and Raxbaxy

USDINR is overheated now . Short @65.5(when it goes there) with SL 66 tgt 63.8– 61.2

Enjoy

NIFTY is buy ..

NIFTY is a buy CMP spot 5278 and is a buy in future with sl 5211 spot on closing basis for the target of 5333—5373–5423(in future).

STOCKS TO WATCH:

SBIN: sl 2072 tgt 2222

TATA STEEL: Cmp 464 sl 444 tgt 478—486–499

HINDALO: Cmp 129 sl 124 tgt 136

RELINFRA RELCAPITAL is a buy on every dips..

RCOMis now a great investment pick cmp 84 tgt 142—-208 (12 month tgt)

More to come…..

Will it crash?

First I wish all my followers a very Happy New Year.

After a long time writing a detailed market outlook here but I hope you must have minted good money following my calls on facebook and twitter , which were quite regular but I am not in the category who bombard with calls with each market movement, instead my calls on market is always directional and on ‘opportunity’.

As mentioned in my fb post (link) market played its jerk-up and now it seems exhausted. Most importantly different indexes and commodities are making lows and then making lower high Dow Jones being an exception .  But as I have mentioned several times there is nothing like decoupling and everything moves together and there might be temporary out-of-sync movements which a trader should utilise.

Now it’s the time fundamentals will start playing . And now the big one Dow should take a hit on downside(together with many other indices which were playing up-down game till now) as till now it was the only investible place (like some time back people used to think about gold which is almost 25% down from peak) . As it was rising not because of any positives but since every other place on the planet had negatives. But now is the time when people will start getting over-cautious  discounting any good news coming and the only safe heaven will become the real money and that’s cash (which currency being that cash is a different question and my plain simple answer for that will be Dollars and Gold – as currency not commodity as both have solid backing of hundreds of years).

So I won’t be giving any trading levels here (as the free calls will be updated on fb and paid subscribers will be getting calls personally) ; but the outlook in plain words is : NEGATIVE.

But yes this down and several countertrend moves together with next move up is a grand opportunity to create wealth and the ‘right time ‘ which I always talk about for taking positions. And also for traders a big cycle doesn’t matter most but what matters is profit on leveraged position on a small movement of that cycle . Example being last month in which in spite of my negative outlook major profits were made in long calls(as that gave fast results: mostly intraday and BTST) than in short positions(which were few in number from my side to subscribers) . For this major Wealth Opportunity we are also launching a special subscription which will be unveiled shortly( within this week) .