Market outlook

Some signs of buying today which got fizzled out soon.

So the impact of Friday's apparently "good news" of S&P upgrading India's outlook did not impress the market. So much for fundamentals. And when markets sell off on good news or ignore them, it means something else is happening.

Small cap index chart

Trend is down... more downsides below 4800.

Weekly charts shows support very well

Market outlook

Friday's bullish piercing bar failed to generate any follow through buying thus negating any bullishness the one day rally created.

This means the previous trend i.e. down is likely to continue.

Weekend update

On EOD charts, we had a bullish piercing bar - this has bullish implications as long as today's low 7840 does not break.

Further confirmation will come if we have a gapup opening on Monday (i.e. above 8020 spot).

Inability to sustain at higher levels can mean weakness and negation of any bullishness attributed to the piercing bar.

The broader trend as per swing theory is down... this will get negated if markets close above 8200 spot.

Option writing points to support at 7800 and resistance at 8200.

BANK NIFTY update

Breakout above 15600-15700 failed.

BNF also broke the swing low formed at 15775 thus indicating a change of trend.

Market outlook - first sell signal in 13 months

NIFTY broke key supports for the first time in this rally. The positional buy has turned to a sell the first time in 13 months.

Charts are very interesting and today I will be presenting different perspectives.

Market outlook

Trend is up and will get "stopped out" on close below 7920 spot.  However expect support near 7850 spot.

If we get an exit signal, this will be the first sell signal after 1800 points rally in nifty.

India's Mars mission Mangalyaan creates history

Yipee..... this is fantastic news and pardon this post in a stock market site but I am crazy about space related stuff and hence could not resist this.

This is nothing short of a historic and a phenomenal achievement if you consider the time frame (less than 2 years from start to finish), the cost ( 450 cr a mere 10% of what others spend) and the result (first country to achieve this on maiden attempt).

Full detailed and exhaustive information available on this wikipedia link.

Also read the press release by ISRO

Special congratulations to the ISRO team who all made this possible.

Market outlook

Trend is up but is showing signs of exhaustion. The frequency of down days is increasing and number of up days is decreasing.

Good support exits at the region of 7850-7900. Close below this will mean trend reversal (nifty).

This will also lead to formation of lower swing high and break of recent swing low (7925).

However there is a complication from the option writing clues which shows highest support at 8000 levels (OCT series). As of now option writers are bullish in the sense they do not expect 8000 to break in OCT series. This situation will change going forward though.

Market outlook

Trend is up with support at 7850 spot. Advance decline was marginally bullish.

Close above 8200 will lead to more bullishness.

On a different note, VIX is below 12 and complacency is increasing in this market. Note that there is

Peakprosperity.com - interesting site for bulls and bears

Just chanced upon http://www.peakprosperity.com/ when I was searching for something else.

I found it interesting for various reasons....
1.Expectations of a crash in US economy (long term)
2.Series of short simple and easy to understand videos on managing the coming crash.
3.Refreshing new way of analysing current global economy.
3.The author. Chris Martenson has an interesting bio which nicely explains his motivation to get into teaching, then financial management and his transition to an eco guru or scientist. Bio makes pleasant and worthwhile reading.

Weekend update

NIFTY closes near high of this week. All time high is 8180 spot.

Going forward, the region of 7850-7900 is going to be an important level for trend reversals.

VIX is at record low levels and is creating fear in me just when others are getting greedy.

Market outlook

Trend is up with reversal level at 7540 spot... my tentative higher SL is now at 7850 spot.

VIX is at extremely low levels and I am getting worried now.

Market outlook

Trend is up with support at 7540 spot.

On my swing indicator, trend reversal will be confirmed on close below 7850 spot.

NOTE: this sell signal can sometimes lead to a whipsaw as profits to date are high at 1700+ points and after a strong trend it is normal for markets to trade sideways and thus generate false signals.

Market outlook

Trend is up with swing low support at 7540 spot. While correction has started, a faster retracement of the rally starting 7540 will confirm end of this bigger rally starting from 5500 levels.

Open writing points to resistance at 8200.

VIX was marginally up indicating not much panic in option writers.

Fear of losing profits

No matter how much analysis you do, the probability of any trade failing or succeeding (over a 1000+ trades) is on an average 50%.

Position sizing will take care of the risk.

Once you understand this, it does not matter what system you follow or how much analysis you do.

Question on Risk management/ Money management

I understand from your blog that risk per trade should be limited to 1% of capital. So if I have Rs.500000 to invest, my risk per trade would be Rs.5000. Suppose the Last close of a stock is Rs 100 and SL is at 90 (10%), the no. of shares I should limit to is 5000 / (100-90) which is 500 valued at Rs. 50000.

What is your advice regarding limiting investment per stock to certain %age of total of capital, say 2%, 3%....so on,  or should it be decided by number of max positions one should keep. Suppose, I am not comfortable with more than 20 open positions at a time. This will limit my investment to 500000/20 i.e. Rs.25000 investment per stock. What are your views on limit of investment per stock, if one is keeping aside Rs. 5 lac capital for shares. And what will be investment limit per stock if the capital is Rs. 10 Lac.

B.P.Singh

Weekend update

Trend is up with support at 8000 and then 7540.

Option writing points to support at 8000 and resistance at 8300. Overall bias is bullish.

CNX IT technicals

Trend is up with support at 10600.

On weekly charts, trend is again up ( 3 year charts) and we have minor support at 9500 and swing low support at 8500.

BANK NIFTY technicals

BNF is bullish with support at 15600... last few candlesticks indicate sustained buying at lower levels.