Wednesday, June 12, 2013

Markets Have Corrected - Time To Buy Again

Those who have been waiting for my post since 31st May, would realize that I have been quiet for a reason. There has been bloodletting in Indian markets and in such situations its better to witness from the sidelines. That is why I have been giving no recommendations for the last two weeks. I wanted the dust to settle down before we take up the fight again. Now the time has come to start buying in Indian stock market. You may well ask - why? There are many reasons which I shall elaborate in succeeding paragraphs, but the primary reason is technical in nature. You see, there is this Golden Ratio of 61.8% which is generally found in all aspects of nature. This has been expounded by an Italian mathematician named Fibonacci. Today Nifty has retraced exactly 61.8% of its earlier up-move  from 5477(10 April 2013) to 6229(20 May 2013). See it in the chart given below:-

That's the technical aspect for starting your buy tomorrow. The other reasons for buying which will have sentimental and fundamental effects on Indian markets are listed below :-
  1. Rating Agency Fitch has revised the outlook for India from Negative to Stable.
  2. Rupee has reversed its falling trend and has risen 1% against the US Dollar.
  3. Finance Minister will announce measures to rescue Rupee tomorrow.
  4. Globally Dollar is weakening as is evident from the Dollar Index
So there you are! Come tomorrow be mentally prepared to start shopping in Indian stocks of substance. Nifty is expected to open  with a gap up tomorrow and should cruise to level of 5850. Today Nifty closed at 5760. Happy Trading! 

Friday, May 31, 2013

Storm It Was - A Terrifying One At That!

It was not Nifty or Sensex falling today, but the manner in which they fell. Simply wiped out the species called bulls from the market. It was terrifying to say the least. It was a super storm. In my last blog-post I had a premonition that a storm was in the making. Check out this post here.

I was wondering why an expiry day was so dull. It was as I was contemplating - a lull before the storm. Bulls were being made to climb up the gum tree. It was a perfect setting for a Bull Trap. Well done Bears!.

That said, I am not fully convinced that the gruesome sell off had anything to do with GDP numbers as is being publicized. GDP numbers were in fact a tad better than market expectations. And if expected GDP numbers did not rattle the markets yesterday, then why the sell off today. It doesn't stand to reason. The combination of following can be the reason for such determined sell off:-
  1. RBI Governor hinted that rate cut is not likely. And since this rally was June rate cut driven, hence the sell off today.
  2. PM hints at cabinet reshuffle, so an air of uncertainty hangs in air. And markets loathe uncertainty.
  3. The relentless slide in Rupee against Dollar, indicating that tapering of QE-3 in US is on the cards. This will result in tightening of liquidity in markets for all asset classes. 
That said we had Chamblfert June Futures hitting its stop loss at 58. Hence we had to book loss of Rs 8000/- .Sadly there seems to be Policy Paralysis for Fertilizer Companies, even when the monsoons are approaching and clarity on subsidy is awaited from Govt. With non-Urea fertilizer prices being so high, farmers will adopt Urea as their preferred fertilizer. Let us see what Govt decides to do in an agrarian economy - further snuff out agri-based industries or give incentive to boost them. Time will tell!

I am planning to run a series through this blog on all profitable Indian industries that Govt has succeeded in butchering through its quaint policies. God knows what sadistic pleasure is being derived by the GovtOthrough such policies. We shall evaluate later, so keep checking out this space.

Thursday, May 30, 2013

Lackluster Expiry - Is It Calm Before Storm

An uninspiring expiry day!. Markets did nothing much throughout the day and very stock specific action ensured that markets closed in green. But the actual fact cannot be gauged by the green tick in Nifty or Sensex. The actual story of the broader market was that it sold off. There were more declines than advances. Metals and Infrastructure bore the brunt of selling, even as Indices rose from red.

But it was surprising that there was hardly any volatile movement on an expiry day. No mad surges to cover positions and hence it was overall a boring session for an expiry day. However the slide in the Indian markets was not as pronounced as the overnight global qualms. With Dow having closed 106 points on worries of tapering Quantitative Easing (QE-3), one could have got more jolt in Indian markets. By that standard there was calm in our markets today.

Be that as it may, we have a position on the buy side still standing. It is Chamblfert June Futures which closed down today at 56.1. In case you forgot, I had recommended its buy yesterday in this post.
Those holding this position should hold it till 50. All the best!.

Wednesday, May 29, 2013

Trading Tips For 29 May 2013

8.45 PM
Chamblfert June Futures was bought at 47.1 but that is sheer impatience which has cost us. I have to admit that I lost my patience as markets slid down in slow motion and gave an update at 10.07 AM to buy Chamblefert at current market price. This was despite the fact that as per my  calculations the buy price was between 46/ 46.5 which I had given at 7.18 AM today. Well the low of the day for Chamblfert June Futures was 46.15 and it closed at 46.45. What a bumble for losing patience. Anyhow, hold the scrip for target of 50 which should be achieved in 3/4 trading sessions.

As for GSPL June Futures I had asked those holding the lot to sell today between 61 and 62. Check it out here. GSPL made a day high of 61.4 . Even if you have sold at 61 you would have made a profit of Rs 12000/- flat.

Buy CHAMBLFERT June futures at 47.1/47.2. Intraday tgt 48.5. Current price 47.1

7.18 AM
Keep the following stock futures of June series on your trading screen and try and initiate any trade that reaches my recommended prices :-
  1. Sell LICHSGFIN at 292/295 for target of 260
  2. Sell SRTRANSFIN at 865/870 for target of 800
  3. Sell CESC at 352/355 for target of 330
  4. Sell HDFC at 955/960 for target of 910
  5. Buy CHAMBLFERT at 46/46.5 for target of 50. Stop Loss- 45

Tuesday, May 28, 2013

Profitable Trades Of June Series - Buy Was Mantra So Far

From 24th May onwards I have been recommending various stock futures of June series for buying. Check it out here.

Yesterday I had given call to buy Indiacem June Futures at 70 in this post. It was traded at 70. Last evening I had posted an update asking all who bought Indiacem to exit today above 72. In today's trade Indiacem closed at 73.05 after making a day high of 73.25. Since the lot size is 4000, one would have made  profit in the range of Rs 8000/- to Rs 12000/-.

The other stock futures that got traded yesterday as per my recommendation was GSPL June Futures. It was bought at 58. I have given a target of 65 for this scrip. Today GSPL June Futures closed at 60.8 after hitting a day high of 61.25. Lot size of GSPL is also 4000. This means that those who have bought this tip are already sitting on a profit of Rs 11,200/- from one lot as per closing price. That is a decent profit return in two trading sessions by any stretch of imagination. Hence tomorrow I would advice all those who are holding this lot to take profit off the table by squaring off their position between 61 and 62.

Once again I am appealing to all those followers of this blog, who are still debating about trading stock futures, to get out of their shell and start profiting from my trading calls by trading them. I shall be posting my tips for trading by tomorrow morning before market opens. Till then, take care!