Nifty weekly view

Next week's strategy for nifty based on weekly levels
Stock Name: S&P CNX Nifty
Pivot:4071.82
Lo: 3,981.1 Hi: 4157.65
S1: 3,986.0 R1: 4162.48
S2: 3,895.3 R2: 4248.32
Projected Hi:4134.4 Projected Low:3933.4
Projected Close:4034.58
The projections are based on a linear corrective channel, if the projections are violated significantly the market might be in a new trend.
The pivot point is 4072 long above that for 4135-4160-4200-4240
and short below pivot for 3986-3981-3933

Weekly strategy based on brute force elliot wave (not weird diametrics etc since I don't understand what in gods name a diametric is and how it works, if you want twisted wave counts go read patil, he is the master of convoluted ewt)
w4 ideal retrace support @ 0.382 3987, 0.5 3915 sl w1 top 3900 , target 4184-4240-4440
Just remember, standard technicals w4 is another word for a higher low
and the bullish hope is that we are doing a complex/flat/sideways corrective
If you see a stock trending down or doing a double top/hns no harm in trying to trade it short.

Dow held 13200 : low 13216 and our markets held 3987
Dow made a damn near full recovery on friday.

The level given for trading long intraday worked perfectly above 4030 play long sl 4020. These were automated system levels.
Also the narrow sl 4020 was not hit on closing basis nor was the wide stop hit 3965
narrow sl is whipsaw prone intraday but wide stop should be used for disaster protection.

For now I stick with the rising channel view. The trend is the channel this is ewt+gann+elder ema all 3 saying up.Nifty view remains 3987/3915/3900+ -> 4184-4240-4440.
Possibility of a complex corrective pattern unfolding remains but the key is that the drop should not be very steep now this was mentioned in the initial analysis for the w4. W4 as a general rule should not break the rising channel significantly.
critical for next week 4100 and 4135 for any upside breakouts.

The bullish view is justified on 1 year fundas considering that nifty is at fair value 19x earnings 20% growth rate. We can go down 10-15% max where value buyers would be waiting and up maybe 5-10-20%. Then again someone was saying sensex fy08e is 1000???
Target for next year could be 16-19k. The question is does anyone release reports on the fundamental valuation of nifty/sensex? Why do people release 10 times as many technical reports for nifty/sensex and the other way around in stocks???

If someone has a funda report on nifty/sensex for 1-2 years send me a copy.
Last one i had said something like sensex 50k in 10 years by morgan stanley using 8% cagr gdp growth rate.

The only safe way to be long nifty is with call options. 4000 call for 100-120, reward/risk is built into the price of the call itself.
Watch the rising channel in stocks. Nifty/reliance/rcom type stuff will collapse much later than individual stocks if we are indeed double topping.
One can trade hedged by being short on broken channels/weak stocks and being long on stocks giving fresh breaks or holding their supports in this sideways phase.


I'm going to take a small break from overtrading :)
Will just play positional on nifty i think.
Coding a cutting edge system based on fractals
No not the bill williams 'fractal' which is just one example of a 'fractal' http://en.wikipedia.org/wiki/Fractal

Elliot wave is a fractal
1-2-3 higgerty is a fractal
1-2-3-4-5 + trendline break is a fractal
1-2-3-4-5+abc is a fractal

an inv hns is a fractal
a hns is a fractal
a triangle is a fractal
etc etc
the question is which arrangements are profitable with what kind of entry/exit/sl/trailing stop?
One could test by hand and go crazy. Since I am already quite crazy and do not wish to go completely insane, I am going to let a computer crunch the numbers to find both global and local optimals.

Some people were asking for delivery picks
dabur invest 90-80-70 invest sl 50 target
100-120-160-180-240
1-2-3-4-5 years
Market is priced for growth there are not many bargains at current levels in the frontlines.
ex dabur cagr 20% currently trading at 30x earnings bring it down to 20-25x trailing and I would seriously buy tons

Considering that there is a lot of certainty in the future growth of dabur it might mantain premium valuations and just go sideways instead of down.
If you want to get rich you gotta wait for the panic to enter dabur
near 80-76 ideally

rcom already given read old post.
wockhardt 400-384 support zone, long term pick. trailing eps 17*20 value area is 340 but market might not bring it down to value, target is 32*20 within 2 years 640.
Also be wary of how the fresh acquisition impacts the stock, stock has been declining ever since the acquisition news/results.

hll also a long term pick, but hll needs to get its act together before it gets bashed by dabur/colgate
Up until few years ago hll used to be 30x earnings and dabur was 20x
now dabur is 30x and hll is 20x
how quickly life changes :)

Tcs also given as an invesment near 1200-1150-1050-1000
sl 500 target 1500-2000-3000 etc etc etc.
They are adding another 32k employees this year.
They will keep growing 30% cagr for quite a few years maybe even a decade.
This rupee appreciation setback is temporary
and even with this i believe they have significant pricing power and could actually raise billing rates for the offshore component to offset the stronger rupee.
Go talk to some tcs manager to get the inside scoop :)

Maruti given as a possible investment near 784-800 20% growth rate selling for 15x

What else: Will post other picks later
Keep in mind no stops in delivery except fundamental stops. Like guidance gets lowered or yoy slowdown etc.
Max position size 5-10% of capital in one stock.

Parsvnath delivery pick near 300 target 600 sl 150
The only reason I am giving the sl figure is so that people buy only in small quantities in delivery :)
The trading levels if any will be posted separately parsvnath narrow sl 295 wide 288 or so
Target 320-352 soon but first some consolidation around 300
false breaks on both sides possible. Long above 300-295, sit idle below 295-288.

Rel invest 500-440 region hold for 650-720
Short term some problems with u.p land mayavati and what not
But use short term weakenss to enter.
Old buy call on rel is also there with sl 500

Traders might want to avoid rel and try long on tatapower/ntpc/cesc
Just remember
reliance brothers feud 550 stock crashed to 480 (p.e of 10-12x)
stock rallied 520-530 buyback announced for 570 stock dipped to 480
Currently reliance trades at 1500+ :) (p.e of 20x)


Another investment pick
Stock Name: ASHOKLEY
Buyarea=37.7476
Support1 :39.74 Support2 :37.71
Resistance1:50.10 Resistance2:57.75
Target1:41.5717 Target2:45.3958
Target3:49.9848
SL1:36.218 SL2:30.0994


REL is near a p.e of 10-13 right now
Will touch 650 in 2 years
720 within 3
Wouldn't it be fun if REL were to go into retail as well?
Or some other venture?? :)


I mean all reliance had to do was go into retail and it goes from a stock which can barely sustain 10x p.e to something that rides high at 20x.
You have to understand when you are a huge company with cash on books which is idle you can do a lot with it.

Ambanis are among the top 20 richest people of the world.
P.E etc is fine but cash is king, do not forget that.