Nifty: Daily Price Analysis

[nimish_rulz]

Raunak Final Question for you. This is the second day reversal of Euro and Going up by more than 3% 2 days in a row. My question with Euro shorts at lifetime high every tom dick and harry is short Euro can we see a short Squeeze in euro and thus a rally in equity market all premature but it has come above the 1.25 crucial and critical level from 1.21 as a low. Everyone was talking about parity and a breach of 1.25 to take it down to 1.16 levels.
Pardon me for jumping the gun too early. I am not entering the markets until we see 5050 closing basis, 5270 taken out of FTSE, 10500 on the dow. Still my view is same as you. But these are cautiously optimistic signals with also AUD USD trade reversing after falling off a cliff.


I am all over the place and Hence for me its best to be out of the markets.

 

[AW10]

I am looking to close my long term positions tomorrow(These were buy hold positions but I guess we are in some serious down moves). My plan is that I am not going to buy shares I hold unless a.) I see nifty above 5000 now. b.) 2% above my selling price. Do you think I am making an early exit or wait and watch this week and take a decision on Monday tomorrow being the German meeting to confirm the bail out package would be provided or not. What markets are signalling is that bail out will fail.

Nimish, just expressing my view on selling tomorrow (also comes from personal experience and from stories of my friends).
In short term, mkt is oversold. So selling after sell-off is not what professionals do. If our long term view has changed and we want to exit the portfolio then the decision is taken. Now you can very well time that decision using short term bounce. We can't live with pain for very long term, and it has been almost 2 weeks of pain now. So we might see bounce in next few days.. Generally, the first bounce from such steep drop is also quite fast and steep.. so better to wait for that and then take the action.

We all have pain-bearing limit, and generally this limit is hit after massive selloff.
I wouldn't sell anything in oversold market.

On the chart, we have broken 200dma with Widebars. On weekly chart, it is big red bar, which is certainly telling me that this break is not a touch of 200dma. Going forward 200dma /50dma will become resistance now. We have left an unfilled gap near 5100 level..so I won't be surprised if we bounce back to that level and fill the gap. Lets see what market does next.

Hope this helps.
Happy Trading.

 

[AW10]

Nimish, how did 2008 affect us ?? When Lehmann happened most of the analyst said we are safe. None could foresee what was unfolding. Now after events have happened we can relate as to how 2008 affected us. Similarly, how is 2010 affecting us?? Still we see all the analysts coming out and saying India is safe. It is only when the event happens, we would know how it impacted us. Discounting the impact of news is one of the most toughest and complex things to do. Analysts have to say as they have to justify the price action. It is their job, else no one will invite them for interviews.

Hope you get my point.

Tc

It is well researched fact and CEO And analysts are most bullish at the end of bull wave.
and they are most pessimist at the end of bear wave.

That should justify why they are not trader, but CEO and Analysts.

 

[nimish_rulz]

Nimish, just expressing my view on selling tomorrow (also comes from personal experience and from stories of my friends).
In short term, mkt is oversold. So selling after sell-off is not what professionals do. If our long term view has changed and we want to exit the portfolio then the decision is taken. Now you can very well time that decision using short term bounce. We can't live with pain for very long term, and it has been almost 2 weeks of pain now. So we might see bounce in next few days.. Generally, the first bounce from such steep drop is also quite fast and steep.. so better to wait for that and then take the action.

We all have pain-bearing limit, and generally this limit is hit after massive selloff.
I wouldn't sell anything in oversold market.

On the chart, we have broken 200dma with Widebars. On weekly chart, it is big red bar, which is certainly telling me that this break is not a touch of 200dma. Going forward 200dma /50dma will become resistance now. We have left an unfilled gap near 5100 level..so I won't be surprised if we bounce back to that level and fill the gap. Lets see what market does next.

Hope this helps.
Happy Trading.

Thanks. I was out of quite a lot of my positions at the breach of 5290 and since then just playing the bounce or fall trading which I have completely stopped now because the markets are too volatile and too much indecision on my part too with everything going everywhere. For now sitting out of the market but the fall has started to worry me on the long term portfolio which my parents own and I want my dad to sell everything before we go down massively. What happened today in the European market was that most of them breached a low of Feb and quite a lot of Asian markets too.
Nifty is yet to do that FIIs havent sold as aggresively as they did back in Jan 2-3 major sellings can quickly bring the market down.

But on optimistic note FTSE bounced of the lows to close above that feb low almost instantly.
Also EUR USD unwinding taking place not sure where it will lead us but maybe weekend might be good idea to think more.

Also our market showed character and strength today only market to close in green Too much of a daredevil I guess

Hope u understand my concern and thanks for the advice.

 

[pegasus]

Nimish, how did 2008 affect us ?? When Lehmann happened most of the analyst said we are safe. None could foresee what was unfolding. Now after events have happened we can relate as to how 2008 affected us. Similarly, how is 2010 affecting us?? Still we see all the analysts coming out and saying India is safe. It is only when the event happens, we would know how it impacted us. Discounting the impact of news is one of the most toughest and complex things to do. Analysts have to say as they have to justify the price action. It is their job, else no one will invite them for interviews.

Hope you get my point.

Tc

Sir.
My thinking about the present scenario is even more grim. See in 2008 lehmann was main culprit the collapse of the financial sector which got bailed out by Uncle sam for a big price, then the turn of events had put their and the world economy in jeopardy. The greece problem- instead of letting the ill disciplined economy to die and rot the EU came up with a staggering rescue package. Now the package linked even the buzzing economies of EU to the dirty filthy PIGS economies. I don know what will happen to the great american bailout but the greece bailout is probably expected to fail. The failing of which will lead to failing of europe as a whole,after all divided they stand united they fall.once europe falls America would fall and then the world. Being a small part of this world we wont stay away.Like the last time this fall is not about a bank or a sector but governments and economies as a whole.The events of 2009 were called a recession was it actually a prelude of worse things to come are we staring down at a bigger badder recession.that makes me to stay away from getting invited to these falls....anyway the bear has bitten the bull many times over in my head its so injured that it will take time to heal. I would like to ask all new age ,self styled gurus especially raunakji what is his opinion over the matter?
Please don blame or abuse me to be too pessimistic I cant help being due to my sixth sense! FOR me levels of 4500 are too optimistic to be seen as a base. sensex could fall further even after june...please do think about this probable worst case scenario do tell whther you think that can happen if not do forgive this naive investor for asking such a silly query...

 

[aditya14]

kind of funny thing to say now but Dow is looking strong after coming from 3.3% down now.Euro is rallying and may go much higher coming weeks.Maybe just maybe the markets will be saved next week.

 

[rajputz]

kind of funny thing to say now but Dow is looking strong after coming from 3.3% down now.Euro is rallying and may go much higher coming weeks.Maybe just maybe the markets will be saved next week.

I too think that short covering can bring a little upsode in market.

 

[pegasus]

hey now dow jones looks ready to break below 10000.what do you feel

 

[SwingKing]

Sir.
My thinking about the present scenario is even more grim. See in 2008 lehmann was main culprit the collapse of the financial sector which got bailed out by Uncle sam for a big price, then the turn of events had put their and the world economy in jeopardy. The greece problem- instead of letting the ill disciplined economy to die and rot the EU came up with a staggering rescue package. Now the package linked even the buzzing economies of EU to the dirty filthy PIGS economies. I don know what will happen to the great american bailout but the greece bailout is probably expected to fail. The failing of which will lead to failing of europe as a whole,after all divided they stand united they fall.once europe falls America would fall and then the world. Being a small part of this world we wont stay away.Like the last time this fall is not about a bank or a sector but governments and economies as a whole.The events of 2009 were called a recession was it actually a prelude of worse things to come are we staring down at a bigger badder recession.that makes me to stay away from getting invited to these falls....anyway the bear has bitten the bull many times over in my head its so injured that it will take time to heal. I would like to ask all new age ,self styled gurus especially raunakji what is his opinion over the matter?
Please don blame or abuse me to be too pessimistic I cant help being due to my sixth sense! FOR me levels of 4500 are too optimistic to be seen as a base. sensex could fall further even after june...please do think about this probable worst case scenario do tell whther you think that can happen if not do forgive this naive investor for asking such a silly query...

Pegasus ,

Your thinking might be right and wrong. Let me tell you how.

1. There are two ways to look at this problem. First, Europe is learning lessons from U.S. and hence have announced a bail out package to avoid the turmoil of 2008. If the package and austerity measures are indeed implemented, then who knows what can happen. Things might eventually stabilize.

2. Second way to look at the problem is that the package fails. After all, why should countries like Germany, France etc pay for other countries debt. This will eventually give rise to the problem of Moral Hazard and Adverse Selection. Angela Merkel is perhaps little jittery because deep down she realizes it.

If the first scenario plays out, we could well stabilize around 4500-4600. However, if the second scenario were to play out, then yes we could be heading a lot lower. Now as an Investor and Trader, I am open to both views but I am not tied to anyone of them. In the end, I'll do what the market suggests.

Tc

 

[SwingKing]

Raunak Final Question for you. This is the second day reversal of Euro and Going up by more than 3% 2 days in a row. My question with Euro shorts at lifetime high every tom dick and harry is short Euro can we see a short Squeeze in euro and thus a rally in equity market all premature but it has come above the 1.25 crucial and critical level from 1.21 as a low. Everyone was talking about parity and a breach of 1.25 to take it down to 1.16 levels.
Pardon me for jumping the gun too early. I am not entering the markets until we see 5050 closing basis, 5270 taken out of FTSE, 10500 on the dow. Still my view is same as you. But these are cautiously optimistic signals with also AUD USD trade reversing after falling off a cliff.


I am all over the place and Hence for me its best to be out of the markets.

Nimish, I don't think levels matter in such markets. Levels are more crucial when everything is stable. This is coming from just pure observation. Supports get violated too often when such market conditions prevail.

Don't be in a hurry to jump in the markets. Just be patient and see how things span out. Things need to be stable for Investors to enter. I was in Spain last summer and I saw the Bull hurling its rider up in the air when it was all heated up and irritated. Market's at present are behaving similarly. Any Investor who dares to enter before the market stabilizes has good chance of being beaten by the markets. Who knows what levels we might see.

Hope you get my point.

P.S. Regarding selling your portfolio, I think it will be better to sell on a bounce back. Today we are going to have a huge gap down opening. We should bounce atleast to the 200 DMA.