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July 26, 2016

Signals today


Market outlook

Daily charts
- trend is up on daily charts
- after yesterday's rally, markets closed in the red
- advance decline was negative
- immediate supports around 8500-8480 spot
- resistance seen around 8650 (weekly charts)



Mid-Cap Stocks Valuation signals danger

The valuation of mid-cap stocks is at its highest since early 2008, when Indian markets were at their peak, and tumbled soon after.

MidCap
Source: http://alphaideas.in/2016/07/26/chart-mid-cap-stocks-valuation-highest-since-jan-2008/

Open positions

Best returns


Worst returns


July 25, 2016

Some top gainers analysed

SATIN up 13%


Neowave analysis by Vivek Patil

....

strength sustaining above the 9-day range could invalidate ET argument. In such a case, the better label for last week’s pause would be “x”, which would turn post-Brexit rally into a Double.
And, on one higher degree, the entire post-Brexit rally consisting of the Double Combination would be considered as “a” leg of the larger 2nd Corrective which opened after Brexit.

All in all, watch the 9-day range as a crucial zone in the Expiry week
. Strength sustaining above the range would continue the rally, but top of “B” would be the next crucial level to determine the variation of Expanding Triangle applicable.


Read more at http://content.icicidirect.com/ULFiles/UploadFile_2016725104610.asp

Market outlook

Daily charts
- markets breakout from trading range formed over past 8-10 days
- trend is still up...
- support now stands increased to 8480 ... the lower end of the recent range
- weekly close above 8600 can lead to retest of 9000 levels



July 24, 2016

A statistical analysis of failures

So why does almost everyone believe that one needs a perfect hit rate to achieve good returns? This myth is quite common as one can see from comments in the media, where people are surprised when some well-known investor has a losing position.

I think it speaks to the ignorance of the following points
-   A losing position has a downside of 100% at the most, but a winning position can go up much more than that and cover for several such losses. Let’s say you have a portfolio of three stocks and two go to 0, but the third stock is a 5 bagger. Even in such an extreme example, the investor has increased his portfolio by 50% with equal weightage in all the three positions.
-  Let’s take the previous example again and instead of equal weightage, let’s say the two failed position were only 10% of the portfolio, whereas the winning position was 90%. In such a happy scenario, the overall portfolio is up 4.5X.

Read complete article at http://valueinvestorindia.blogspot.in/2016/07/a-statistical-analysis-of-failures.html

Trading as a way of life - nice video

Bowes-Little grew up in San Francisco. He gained a scholarship to Brown University in Providence, Rhode Island where he studied philosophy and economics, and later studied at the London School of Economics.
Bowes-Little's first career was as a professional basketball player, after which he worked as a trader for investment banks in New York and London, including the position of vice president, credit trading at Goldman Sachs, while pursuing a second career as a hip hop artist and poet in the evenings since 2007 under the name Metis (a reference to the Greek language, which he describes as "perceiving the true essence of things").
He has written an autobiography, The Trade, which has been picked up by a literary agent and with which he has tried to interest Hollywood directors with a view to turning it into a film.

PRICOL making lifetime highs... still bullish