Market update for 20/07/2012

Nifty hourly chart

Today's trading session is a range bound session. We are still in a tight range of 5190-5260. Nifty spot made a day high of 5258 but was not able to cross 5260. Option buyers should be cautious as there are very few trading sessions left before expiry. Maruti , SBI , Hero Moto , Kotak Bank were the major losers among the index stocks. Maruti is a falling knife don't try to catch it. Most of us try to buy those which are falling continuously assuming that it will bounce back which may not happen immediately.

Long positions in Nifty can be entered if Nifty sustains above 5260 minimum target is 5300 . Stop loss below 5190.(Spot levels).

Chart of the day

JSW Steel

Today metal sector was one of the top gainer. Stocks like JSW steel , Sesa Goa , Tata Steel have performed well. The prices of base metals in international market has increased which is positive for metal stocks.

JSW steel has taken support at 200 DMA as well as an ascending trend line and today stock has bounced back. JSW steel closed at Rs.689.50 up by 2.5%.Stochastics is in oversold region indicating that downside is limited. This stock has the potential to reach Rs.720 .

Open Positions

Scrip	Type	Qty	Price	CMP	P/L
JSW Steel	Long	60	691	689	-120
Bajaj Auto	Long	20	1491	1548	1140
Minifty Aug fut	short	20	5216	5280	-1280

Today's Trade

Scrip	Qty	Buy Price	Sell Price	P/L
LT 1400 CE	250	37	22.35	-3662
Bajaj Auto	20	1491	1559	1360
Tata Mot 230 CE	1000	2.05	2.4	-350

Nifty Medium term trend

Trend	Up
Initiation Date	12/06/2012
Initiated at	5116
High since change	5345
Reversal if closes below	5120

Thought for the day

In order for you to succeed,  your desire for success should be greater  than your fear of failure.

Market update for 19/07/2012

Nifty hourly chart

Today's trading session was volatile one. Nifty made a day low of 5170 and sustained for some time. But closing happened at 5216 up by 23 points which has trapped the bears. Unless Nifty closes below 5190 we cannot expect further fall in the market. 5190-5260 will be short term range and we may not notice a sustainable breakout in this series.

Chart of the day

 

Bank Nifty

Bank Nifty is taking a trend line support . If Bank Nifty closes below 10500 then short position can be initiated.Otherwise we can expect a bounce back.

Open Positions 

Scrip	Type	Qty	Price	CMP	P/L
LT 1400 PE	Short	250	22.35	28.7	-1587
Tata Mot 230 CE	Short	1000	2.05	1.75	300
Bajaj Auto	Long	40	1491	1521	1200
Minifty Aug fut	short	20	5216	5245	-580

Today's Trade

Scrip	Qty	Buy Price	Sell Price	P/L
Minifty Aug fut	20	5216
Bajaj Auto	40	1491

Medium term trend

Trend	Up
Initiation Date	12/06/2012
Initiated at	5116
High since change	5345
Reversal if closes below	5120

Thought for the day

Care about what other people think  and you will always be their prisoner - Lao Tzu

Nothing is more exciting then getting into a trade that blasts off and puts you into a highly profitable situation. This can cause major problems however, because this type of trade puts you in a highly euphoric state and leads to daydreaming about the huge profits still to come. The real problem occurs as you get caught up in the daydream and expectations. This causes you to not be prepared to get out as the market reverses and wipes off all your profits because you have convinced yourself of the eventual outcome and will deny the reality of the situation. The simple remedy for this is to know where and how you will take profits once you enter the trade.

Market update for 18/07/2012

Nifty hourly chart

Today's trading session was a choppy one. Nifty has closed at 5192 down by 4 points. Nifty is again and again testing 5190 levels and bouncing back. In hourly chart Nifty has closed below 5190 but managed to bounce back in the last few mins. The important support at 5190 will eventually  become weak .  Wait for a close below 5190 to initiate new short positions.

Nifty Daily chart

There is no significant change in daily chart. The indications of negative trend like breakout from wedge , Sell indication from MACD , close below 20 DMA has remained the same.Reversal of the trend can happen above 5260. Traders should observe that many index shares are cracking. Bajaj Auto, LT, Tata Mot, large cap IT companies to name a few. It is advisable to avoid positional long position at this point of time.

 

Chart of the day

Tata Motors

Tata Motors was one of the outperforming stock when Nifty was at 5600 before few months. It is in downtrend from few weeks and now fresh shorting opportunity has appeared. In the above chat you can observe that Tata Motors breached 200 DMA at Rs. 195 on 4/1/2012. Since then it was bullish. Even though retracement happened Tata Motors took support at 200 DMA twice at Rs.220 and Rs.224. From past two trading session it is trading below 200 DMA indicating that this stock has entered bearish phase from short term and medium term point of view. Traders can take short for a target of Rs.215-200 and reversal can happen if it closes above Rs.234.

Open Positions

Scrip	Type	Qty	Price	CMP	P/L
LT 1400 PE	Short	250	22.35	18.95	850
Tata Mot 230 CE	Short	1000	2.05	2.05	0

Today's Trades

Scrip	Qty	Buy Price	Sell Price	P/L
Bharti 420 CE	1000	2.75	7	-4250
Nifty Fut	50	5250	5201	2450
Nifty 5300 CE	50	45	17	-1400
Tata Mot 230 CE	1000		2.05
Bharti	150	326	327	150

 

Nifty Medium Term View

Trend	Up
Initiation Date	12/06/2012
Initiated at	5116
High since change	5345
Reversal if closes below	5120

Results

Bajaj Auto , Crisil

Thought for the day

Life is really simple but we insist on making complicated - Confucius

Thoughts of a strategist

Most of the traders depend on other’s ideas / strategies to earn money in market. Because an average trader doesn’t have a time tested method and he is not willing to learn any. So he is depending on blogs , websites , TV and others to get so called recommendations to earn money. Whenever a recommendation fails we blame others but if the expected target is achieved we don’t even say thanks. Most of us doesn’t respect the efforts of many genuine analysts (there are a few frauds)in identifying the changing dynamics of the market.

I am reading book about strategies of war (as I don’t see any difference between war and trading) and recently I came across how a commander (Analyst) thinks when his ideas fail. I thought of sharing with you and I hope you will like it.

Defeat is bitter. Bitter to the common soldiers (Traders) , but terribly bitter to the commander (analyst). The soldier may comfort himself with the thought that , whatever the result he has done his duty faithfully, but the commander has failed his duty if he has not won victory – for that his duty. He has no other comparable to it. He will go in his mind the events of campaign. He thinks here I went wrong ; here I took the counsel of fears where I should have been bold ; there I should have waited to gather strength ; at that moment I failed to identify the opportunity when it was presented to me. He will also remember the soldiers whom he sent to attack and never returned . He will remember the look in the eyes of men who trusted him. “I have failed them” he says to himself and “ I failed my country”. He will see himself as a defeated commander. In the dark hour he will turn in upon himself and question his manhood. But he must not stop , if he wants to command the battle again , he must shake off these regrets , and stamp on them. He must beat off these attacks against himself and cast out the doubts born on failure. Forget them and remember the lessons to be learned from defeat – they are more important than victory – General William Slim (1897-1970)