TRADING IDEAS

1. Don’t trade your opinions trade a carefully written trading plan that expresses a methodology with an edge.
2. Don’t trade your emotions trade your quantified entry set ups.
3. Stop exiting when your scared and exit with your trailing stop is hit.
4. Only trade when the market environment gives your system a green light, go to cash when the market gives your system a red light.
5. Stop trying to force trades, trade the signals not the noise. Wait for a reason to trade.
6. In losing streaks trade smaller and smaller until you start winning again.
7. Quit trying to make some great public “call” about a bottom and focus on making money.
8. Sometimes it is not about making money it is about keeping what you have and playing a strong defense.
9. The sloppy the price action the pickier you have to be with your entries.
10. The more volatile the market the smaller you should be trading.

LEVELS FOR 30-1-14

    Market Review for 30th January 2014     

Nifty (6120) we said ‘technically the bar generated for the day is an indecisive pattern and the trend is still down and there is a good chance that we could witness a technical bounce as the market is technically stretched’ the market saw a technical bounce ahead of the F&O expiry and has flat flat for the day…technically I maintain the same and nothing has changed in my view as the low of a day is still not violated and so we could still see some more technical bounce….  

The support for Nifty is it 6083-6053-6009 and the resistance to the up move at 6200-6225

MARKET CAP OF NATIONALISED BANKS IN INDIA

India has 24 listed government-owned banks – State Bank of India and three associates, 14 banks nationalised in 1969, and six banks nationalabout Rs 1.59 lakh crore. That was fractionally less than the value of asingleHDFC Bank,which started from scratch in 1993 and had a market cap of Rs 1.6 lakh crore. The brightest star on the public sector banking horizon, State Bank of India, had a value on the market (Rs 1.13 lakh crore) that was less than that of ICICI Bank (Rs 1.21 lakh crore). In other words, two private banks of relatively recent vintage commanded greater value than the entire public sector banking system.

LEVELS FOR MONDAY 27-1-2014

Last Close : 6269

As Expected Nifty Future :Was not able to cross our Levelof 6361 level and those who TRUSTED us….Yes Minted Tons of Money on Friday and it looks Sharp gap down

on Monday will be again best day.

Dow ,S&P 500 ,Nasdaq Crashed on Friday……………so 100% Gap down will happen and already SGX Nifty is down by 86-90 points.

So ,What will Indian Traders will get ?Babaji ka thullu 

Just watch :6198————6184 as Crucial Support for SGX Nifty

Decisive Break with volumes and stays below for 20 minutes or more ,Nonstop Panic upto 6138-6124 on card.

Major Support at 6087 level.

TRUTH ABOUT TRADERS

1.    You have to have passion for learning to trade; passion is the energy that you need to take you to your goals.

2.    You have to have the perseverance to keep going after you want to give up.  90% of new traders quit when they were very frustrated while 100% of successful traders didn’t quit until they reached their goals

3.    New traders spend too much time looking for what to trade instead of focusing on who they are as traders.  You have to know who you are as trader first then you can start building your trading system.

4.    Traders have to be able to manage their stress by trading inside their current comfort zone. Traders have to grow themselves and trade size step by step.

5.    The vast majority of new traders fail simply because they did not do their homework before they started trading.

6.    A trader has to build a trading system that matches their own personality and risk tolerance levels.

7.    A trader that chooses to be master a specific type of trading method or trading vehicles has a much better chance of success than the traders that just dabble in many different things and never make much progress.

8.    A trader has to write a good trading plan while the market is closed to guide their trading while the market is open.

9.    A trading plan has to be followed with discipline to have a chance at success.

10.    A trader has to manage their behavior by acting consistently with their own rules.

11.    “The answer to what’s the trend? Is the question “What’s your timeframe?” – Richard Weissman.  All traders are simply trying to capture trends in their own time frame.

12.    Never risk losing more than 1% of your trading capital on any one trade. Once you lose 1% of your capital you should exit the trade.

13.    Be very aware of how much risk your total account is exposed to at any one time through position sizing and volatility.

14.    Set your stop losses far enough away from your entry point to avoid regular noise and fluctuations. Find your stop level first, and then position size accordingly.

15.    A trading plan has to be followed with discipline to have a chance at success.

16.    The money I have made in the stock market was made through following the chart and the trend not from some prediction or opinion.

17.    My biggest trading losses came from hoping, stubbornness, and bias.

18.    My best trading has happened when I was the most open minded simply trying to answer the question: “What is the chart telling me to do now?”

19.    If you have to ask others for their opinions about your trade you should not be trading you should still be in the process of study and writing your trading plan.

20.    “If you diversify, go with the trend, and manage your risk, then it just has to work.” – Larry Hite

BULLISH FOR 2014

The stock market's slow start to 2014 doesn't seem to worry Jeremy Siegel.

The professor of finance at the University of Pennsylvania's Wharton School maintained his bullish outlook on 2014, that he believes the Dow would finish this year at a record high—somewhere between 18,000 and 18,500. His main concern? Getting the jittery retail investor back into the action.

Siegel believes investors shouldn't worry that there's anything wrong with stock market.

The market still has room to grow about 10 to 15 percent next year, but it won't be a straight line, said Siegel, the author of the long-running investment manual "Stocks for the Long Run." It may overshoot estimates, or suffer a correction before hitting fair market value. He said it's normal to be concerned about a strong stock market, especially after the 2008 financial crisis.

Siegel's rosy outlook extended to fears over higher interest rates and a bigger emphasis on stock buybacks among corporations. He predicts buybacks will play a large role in the markets this year, and that their use does not mean a company lacks better capital investments.

He also discounted fears that increased borrowing would spike velocity in the money supply to the point where it could hinder the Fed from controlling inflation.

"Short-term rates are going to stay near zero, that's going to keep that velocity down," Siegel said. "We really have to push the economy and inflation to get the velocity up. It's not happening soon.

PLEASE CHECK

A NEW WAY TO HOLD GOLD

hat if you could carry and exchange gold in the exact same manner as you do with the dollar bills in your wallet?

Recent technology is now making this possible.

Being able to hold gold in this form is significant for several reasons.

First, it makes gold ownership available to all budgets. Many of the world’s households have been priced out of gold to date. This changes that completely.

Second, it enables the potential for everyday transactions should we ever return to a precious metal-backed monetary standard. It answers the challenge: How will you pay for your groceries with gold? With fractional-gram gold notes, it’s now easy.

TRADING RULES

1. The market pays you to be disciplined.
2. Be disciplined every day, in every trade, and the market will reward you. But don’t claim to be disciplined if you are not 100 percent of the time.
3. Always lower your trade size when you’re trading poorly.
4. Never turn a winner into a loser.
5. Your biggest loser can?t exceed your biggest winner.
6. Develop a methodology and stick with it. don?t change methodologies from day to day.
7. Be yourself. Don?t try to be someone else.
8. You always want to be able to come back and play the next day. Once you reach the daily downside limit, you must turn your PC off and call it a day. You can always come back tomorrow.
9. Earn the right to trade bigger. Remember: if you are trading poorly with two lots you must lower your trade size down to a one lot.
10. Get out of your losers.
11. The first loss is the best loss.
12. Don?t hope and pray. If you do, you will lose.
13. don?t worry about news. it?s history.
14. Don?t speculate. if you do, you will lose.
15. Love to lose money. What I mean is to accept the fact that you are going to have losing trades throughout the trading session. Get out of your losers quickly. Love to get out of your losers quickly.
16. If your trade is not going anywhere in a given timeframe, it?s time to exit.
17. Never take a big loss. Only a big loss can hurt you. Please review rules #5, #8, #10, #11 and #15. If you follow any one of these rules you will never violate rule #17.
18. make a little bit everyday. dig your ditches. don?t fill them in.
19. Hit singles not home runs.
20. consistency builds confidence and control.
21. Learn to sweat out (scale out) your winners.
22. Make the same type of trades over and over again ? be a bricklayer.
23. don?t over-analyze. don?t procrastinate. don?t hesitate. if you do, you will lose.
24. all traders are created equal in the eyes of the market.
25. It?s the market itself that wields the ultimate scale of justice.

WEEKLY LEVELS FOR NIFTY

SENSEX (21,063.6)

The Sensex moved to the intra-week high of 21,379 before declining towards the weekend. The movement last week has fuddled the short-term view. The Sensex has moved in the range between 20,550 and 21,500 since December. There are two ways in which this move can be viewed.

It could be a consolidation phase before the next upmove. This will imply that the medium-term uptrend from the low of 17,448 has one more leg to go. We need a strong close above 21,500 to prove this count right. The minimum target in this case is 23,000.

The other medium-term count is that the move from 17,448 is in its final stages and forming a terminal pattern. Continued sideways move between 20,500 and 21,500, followed by a break below 20,000 will mean that the index has topped out and is headed lower in the medium term.

It is hard to judge which of the two scenarios is unfolding since the short-term trend is sideways. We need to see the movement over the next couple of weeks to draw any conclusion. But it is obvious that the medium-term trend is up and a strong move below 20,000 is needed to negate this view.

The short-term trend is down since the index is reversing lower over the last two sessions. Immediate supports are at 20,913, 20,821 and 20,625. Reversal from any of these levels will take the index higher again.

Resistances for the short-term are at 21,379; 21,483 and then 21,973. In short, the area around 21,500 will be the key hurdle in the near-term.

NIFTY (6,261.6)

Nifty hit the high of 6,346 before reversing lower. The index is moving in the range of 6,130 and 6,415 since the first week of December. We are unable to discern the next medium-term move at this point.

A strong break above 6,420 will mean that the next leg of the move from the 5,118 low is unfolding. Minimum target in this case would be 6,590.

If the index moves sideways for a couple of weeks more and then breaks lower below 5,900, it will mean that the medium-term trend has reversed lower.

We will have to decide on the medium-term view after seeing the movement over the next couple of weeks.

The short-term trend in the index is down. Immediate support that needs to be watched is at 6,221.

The next support is at the 200-day moving average at 6,200 and the previous trough at 6,173. Short-term investors can watch out for upward reversal from either of these levels. Short-term resistances are at 6,346; 6,415 and then 6,421.

DELIVERY PICKS

Our Opininon for Today's Market....... 1.Market Looks Volatile... 2 Stay Cautious... BHARAT FORGE (Bse Ticker-500493@ Rs.348/-) Excellent Breakout In Stock!! Door Open For Stock to Cross Rs.450/- TARGET Rs.362/- Rs.365/- SL Rs.332/- INFOEDGE (Bse Ticker-532777@ Rs.541/-) Big Dream Run Start Above Rs.525/- Door Open For Stock to Cross Rs.600/- TARGET Rs.558/- Rs.575/- SL Rs.518/- LUPIN (Bse Ticker-500257@ Rs.916/-) Stock Looks Weak On Chart TARGET Rs.900/- Rs.890/- SL Rs.935/-

LEVELS FOR NIFTY

Observation 
Initiate Shorts below 6298 & Hold existing with the stop of 6360. (All levels in Spot) 
Day’s action formed a hammer sort of candle pattern with good volumes which is a bearish reversal pattern; here it’s 
not an exact hammer pattern but we could consider it to be bearish if price moves below 6298. 

Technically, another lackluster day, very narrow movement witnessed in the index; no significant price development 
either side. Our bearish setup is still intact as index trades below 6360. The recent price development indicates that 
index is forming complex corrective pattern. Internals are W-X-Y (earlier it was simple correction – A-B-C). As it is a 
complex correction it is slightly difficult to predict the exact levels. Overall we are in the crucial stage of the corrective 
phase; however don’t fall in love with bulls until our levels have taken out (6360). The prevailing down trend is still 
intact. And reversal level is placed at 6360 for near term and 6415 for short term, unless violation of these levels 
trend remains down for the target of 6130 – 6070 in near term and 5970 in short term. 

Traders who are holding shorts (initiated at 6285 – partially booked around 6220 - 6200) can hold with the stoploss of 
6360 on intraday basis. Initiate new short positions on a fall below 6298. In case any breakout above 6360; traders 
may maintain mildly positive bias till 6415

EXCELLENT QUARTER FROM TCS

After unexpectedly good results from Infosys and HCL, all eyes were on Tata Consultancy Services on Thursday, as India’s biggest IT outsourcer by revenues posted results for the three months to end-December.

The group announced profits after tax of Rs53.77bn ($873.6m), up 15.1 per cent on the previous quarter, on revenues of Rs212.94bn, up 1.5 per cent.

Chief executive, N Chandrasekaran said in a statement:

Our diversified market presence and services portfolio have helped us overcome seasonal weakness and soft demand in the Indian market.

That sounds good, especially at a time of year filled with holidays, when billable hours fall for these outsourcing groups. But in some ways it’s not as good as industry analysts were expected.

TATA MOTORS GLOBAL SALES DIP

Auto major Tata Motors today said its global vehicle sales, including Jaguar Land Rover, declined by 19.95 per cent to 79,220 units in December 2013, compared to the year-ago period.

Tata Motors had sold 98,968 units in the corresponding period of 2012.

Global sales of all passenger vehicles in December 2013 stood at 49,721 units, an increase of 5.95 per cent, from 46,925 units in December 2012, Tata Motors said in a statement.

Sales of luxury brand Jaguar Land Rover rose by 24.66 per cent to 40,244 units during December 2013 as compared to 32,282 in the same month of 2012.

SIGNS OF STRESS IN TRADING

Markets have been particularly volatile recently, at least for day traders and day trading can create a significant amount of stress. Because our bodies are designed to adapt to stress, we may fail to realize that we are stressed out.

Here’s an inventory of common trader behaviors that may signify excessive stress.

12 Signs of Stress

1. A vivid fantasy of making lots of money today.
2. Feelings of invulnerability.
3. Eating breakfast or lunch at your trading desk.
4. Hyper  focus on price bars as they form.
5. Talking out loud to the market.
6. Bargaining with the market about an open position.
7. Cursing at the market.
8. Expressing irritation at partner, kids, pets, plants, inanimate objects.
9. Sudden urge to increase position size or frequency.
10. Canceling or moving stops for no good reason
11. Adding to a losing position.
12. Trading in your underwear !

TIP: Stress degrades decision-making. If you are stressed out, shift your focus 

LEVELS FOR THE COMING WEEK

The  Sensex moved in a narrow range before closing 93 points lower last week. Down-closes in most of the recent sessions imply that the path of least resistance in the near-term is downward. That the index is moving below its 50-day simple moving average also denotes weakness.

There can be a decline to 20,277 or 19,848 in the week ahead. The presence of the 200-day moving average at the second target will lend critical support. The 38.2 per cent retracement support also helps make the zone between 19,800 and 20,000 an important support to watch out for.

Resistances for the week ahead are at 20,971 and 21,158. A close above the second resistance is needed to mitigate the negative short-term view.

The medium-term view for the index is positive. Index movement above 20,000 will mean that it can oscillate in the band between 20,000 and 21,500 for a few more weeks before the next major move.

NIFTY (6,171.4)

The Nifty, too, moved sideways before closing 39 points lower last week. The chart pattern suggests weakness in the short-term. The Nifty could break lower to 6,117, 6,040 or 5,916 in the days ahead. The short-term weakness will reduce only if the index moves above 6,272. Short-term traders can therefore go short in rallies, with stop-loss at 6,280.

A move above 6,280 will mean that the index is heading toward 6,415 and 6,582. The medium-term trend in the index stays positive despite the negative short-term view. The index has critical support around 6,000 and then at 5,925, where the 200-day moving average is positioned. The positive outlook will be threatened only on breach of the support at 5,925.

BULL MARKET IN 2014 ?

Deutsche Bank on Thursday said 2014 could be a beginning of a new bull market for Indian equities, on the back of a bottoming out of the economic growth and earnings cycle.

The European bank believes the pace of economic recovery and timing of the market rally could hinge on the election outcome.

Most key variables influencing the equity market are at an inflection point — after a long gap — and may result in 2014 heralding the beginning of a bull market for India. Economic growth has bottomed, the corporate earnings cycle is seeing a successive quarter of recovery, investment starts are seeing a glimmer of hope,” said Abhay Laijawala, managing director and head of research, Deutsche Equities India.

The brokerage expects the benchmark Sensex to touch 24,000 (Nifty imputed target 7,150) by December 2014, about 15 per cent up from the current levels.

“At our target the Sensex would trade at 15.9 times FY15 EPS, which (is) a slight premium to past five-year average PE and with earnings growth of 15 per cent valuations to stay supportive,” said Deutsche Equities in its India strategy report.

DELIVERY PICKS

GATI LTD

(Bse Ticker-532345@ Rs.52/-)

Just Watch Rs.54/-

Close Above Rs.54/- (2 Closing ++ Weekly Closing)

Door Open For Stock to Go Rs.85/-

TARGET

Rs.55/- Rs.62/- SL Rs.45/-

WIPRO

(Bse Ticker-507685@ Rs.540/-)

Considering Rs.530/- Strong Base For Stock !!

We See Stock May Soon Start Upward Journey

TARGET

Rs.552/- Rs.560/- SL Rs.518/-

 ZEE ENT

(Bse Ticker-505537@ Rs.289/-)

TARGET

Rs.298/- Rs.310/- SL Rs.282/-

OUTLOOK FOR CEMENT SECTOR IN INDIA

Cement demand recovered slightly during Q3FY14 mainly boosted by individual housing demand. Cement prices also started improving since Q2FY14 end and sustained till November 2013. However, prices witnessed a decline during December 2013 due to lower than expected recovery in demand as well as inventory clearance by large players.

Demand continues to be weak

Cement demand continued to remain sluggish in Q3FY14, with a weak October, followed by a relatively better November and again a subdued December. With demand failing to pick up post monsoon, volumes for major companies are estimated to drop 1-2% YoY. The all India average cement price inched up a mere 1.5% QoQ; and were down 0.5% YoY, making Q3FY14 the third consecutive quarter of YoY decline. Adverse impact continues in housing and infrastructure vertical, coupled with sand mining issues, delayed crop selling and politico-economic uncertainties. Capacity utilization is expected to remain low at ~70%, which is the lowest level in last decade. On YoY basis, HDFC Securities expect 1-2% volume decline for three large caps – UltraTech (UTCL), ACC & Ambuja (ACL).

Pricing Scenario in various regions during the quarter

Northern region:

Construction activity in the region was impacted by festive season as well as sand mining ban. Prices had improved during mont hs of Oct -Nov 2013 while witnessing a decline in Dec 2013. However, average cement prices for Q3FY14 were still higher than average of Q2FY14.

Southern region:

Prices recovered by nearly Rs30 per bag during Sep-Oct 2013 in southern region and witnessed declines during Nov-Dec 2013 due to lack of demand and impact of cyclones. Average cement prices for Q3FY14 for southern region are marginally lower than average of Q2FY14.

Western region:

Prices increased by Rs25-30 per bag in western India during Oct 2013 and witnessed further increase of Rs5-10 per bag during Nov 2013 in anticipation of demand revival from infrastructure segment. Howe ver, sharp decline was witnessed in Ahmedabad and Pune by nearly Rs.20 per bag on aggressive selling by players. Prices fell in December as demand did not sustain at same levels.

Eastern region:

Demand was quite low during Oct 2013 in eastern region due to Durg a Puja festival. However, cement prices increased by Rs20 -25 per bag during late Oct 2013, remained largely flat in Nov 2013 and declined by Rs10-15 per bag in Dec 2013.

Profitability under pressure

Profitability is expected to be under pressure in Q3FY14 as well, after a weak Q2FY14, as there has been weak pricing trend, continued cost push in energy and freight and no major benefits of seasonal operating leverage due to weak demand. However, due to improvement in cement realizations, EBITDA per tonne is likely to improve sequentially.

Outlook

A weak demand scenario has impacted the pricing power of cement manufacturers in the country. Thus, despite the increase in cost pressures due to higher freight fares and power costs, cement manufacturers are finding it difficult to pass on the same through price hikes. Further they also do not expect any respite on the cost front going ahead. One can expect infrastructure spending to go up in the coming months due to the elections (though not majorly), which could be a revenue generating opportunity for the sector. Cement prices are also likely to firm up from mid -Jan, 2014. They keep a neutral view on the sector

FED MINUTES - WHAT TO WATCH ?

After months of mulling the move, the Federal Reserve finally tapered its bond-buying programme a week before Christmas.

The central bank’s staff in New York are now hoovering up $75bn of Treasuries and mortgage-backed bonds a month, down from the $85bn they’d been buying since the autumn of 2012.

The decision to taper adds extra interest to today’s release of the minutes of the December meeting of Fed’s policymakers. Investors will approach the minutes, which are due at 2pm New York time, with several questions and may even get some answers. Here’s a look at three of the questions.

Why did the Fed taper?

The most obvious – and also most likely – answer is because the US economy is showing further signs of improvement. Specifically, the unemployment rate has fallen to 7 per cent, rising house and equity prices have helped rehabilitate the finances of some US households and the drag from last year’s tax rises and sequestration should ease.

Investors, though, will also be interested in whether a stronger prompt for some officials is the concern that the cost of the bond-buying programme is outweighing its benefits. Anxiety the policy had begun to encourage reckless risk-taking was on the minds of some policymakers when the Fed first signalled its intention to taper last May.

How quickly will the Fed taper?

Those expecting the minutes to reveal detailed discussions about whether the Fed will reduce its purchases by $10bn, $15bn or any other number from now are likely to be disappointed.

Instead, investors will have to piece together an answer based on how optimistic a note the minutes strike about the outlook for the US. It is worth bearing in mind that the Fed has consistently erred on the side of caution, so the minutes will have to be particularly effusive about the outlook to persuade investors the central bank will taper at anything more than a measured pace.

Indeed, the minutes are likely to underline that the Fed is prepared to slow tapering should the data deteriorate significantly.

Is the Fed contemplating more changes to its forward guidance?

As the Fed begins to slow its bond-buying programme, it is relying ever more on so-called forward guidance to shape investors’ expectations about future policy.

In practice forward guidance amounts to verbal promises and the deployment of so-called thresholds.

The December meeting saw the Fed tweak the language around its unemployment threshold – the level the bank insists the rate needs to be at before it will consider raising interest rates. December’s statement said:

It likely will be appropriate to maintain the current target range for the federal funds rate well past the time that the unemployment rate declines below 6-1/2 percent.

The interest will be if the minutes reveal officials considered any other changes to its forward guidance, as the Fed seeks to convince investors that tapering will not quickly be followed a broader tightening in monetary policy.

FAMOUS FAILURES