Friday, February 24, 2012

EOD Analysis For 24th February 2012 and Outlook For 27th February 2012

OI in Nifty futures dropped to 26 million [not surprising after expiry] and profit booking would be fairly logical. VIX hovering around 25

Critical levels and outlook remain unchanged from yesterday;

Expecting some volatility on both upside and downside towards the budget week based on what we saw last year
[An initial spike as the budget was being delivered, then a sharp fall and then a huge climb of almost 200 points on a Friday after the budget was digested - so the pattern of ups and downs can be expected to continue during the budget week this time as well - best played by straddling OTM options IMHO]

For Satyaji et all - I had mentioned in one of my posts earlier as well that as far as major swings are concerned, I just take the following timelines [still learning and sharing what I know so far]

Dates Primer:

4 critical dates that remain unchanged every year
21st March - Spring Equinox
21st June - Summer Solastice
22nd September - Fall Equinox
21st/22nd December - Winter Solastice

For the other critical dates, take the swing tops and swing bottoms of the previous year and add 377 calendar days to it - around that time, a major swing opportunity will come through [though direction needs to be observed on current trends. Here, tools like EW, SAR, Trendlines help IMHO]

Last year, we had the following swing tops and bottoms

5th Nov '10 -> Swing Top of 6338; 377 days later was 16th Nov '11 and hence I said there will be a fall around this period - partial tukka I agree :D
4th Jan '11 -> Swing Top of 6181; 377 days later was 15th Jan '12 [I was expecting downside here based on Nov '11 action but trend was UP :(]

11th Feb '11 -> Swing Bottom of 5177; 377 days later was 22nd Feb '12 [Based on Jan '12 experience I was expecting a fall around this period :D but stood corrected with the term 'bearish' We got a correction of almost 140 points from the high of the day!]

For future dates of 2012, we need to see trend at that time but pretty sure that the time frame around these time zones will provide good tradeable swings ;-)

6th April '11 -> Swing Top of 5944; 377 days later will be 16th Apr '12 [2012 being a leap year]

20th June '11 -> Swing Low of 5196; 377 days later will be 30th June '12 [also note that 21st June comes in this period only!]

8th Jul '11 -> Swing Top of 5740; 377 days later will be 18th Jul '12

26th Aug '11 -> Swing Bottom of 4720; 377 days later will be 6th Sep '12

28th Oct '11 -> Swing Top of 5399; 377 days later will be 8th Nov '12

20th Dec '11 -> Swing Bottom of 4531; 377 days later will be 30th Dec '12

Full Moon days have larger odds of being down days

After some costly lessons in summer '11[got ripped off with Puts from 5550 to 5850 and revising stop loss at every rise of 50 points!] and subsequently under guidance of my seniors, I am trying to imbibe what spiderman keeps saying - 'trade little, trade healthy' and always as wave rider says, trade with the edge of hedge because we are all human; if not sure of a trade setup, stay out. So now one has the support/resistance levels [given last Friday] as well as major time periods for 2012 [given today]. I sincerely hope it helps readers.....
The reason why I am timing the primer posts around this period is because it is very special to me personally. This week marks a one year anniversary when I first came across my seniors / gurus on mmb i.e. Wave Rider, Raghuji, rcg[ji] Harshal bhai, Suranaaji, Sarmaji and comrades like Shriram, Bhatiaji, Sunny bro and the journey has been extremely fruitful so far. Today's post is dedicated to my seniors. All I have is 'Attitude of Gratitude' for the way you literally held my fingers and taught me the basics.

AAAAAAAAHHHHHH - Too much gyaan Nagi! Enjoy your weekend. [Hope you will also enjoy the tit-bits on diversification v/s diworsification from time to time :D]


reachnagraj / theknight16 said...

There are a lot of names in the comrades list that I have not mentioned but can assure you that all of you are always in fond memories and will continue to be....

SATYA KAMA said...

Nagraj Ji,

Thank You Very Much for the information.

We are following this group since 'Money Control' days and developed interest towards trading only and only because of this group. we used to have aversion towards day/short term trading. After developing interest with this group we learned a lot about the dynamics of the market. This helped us a lot in our long term investment strategies also.

We do not mean that we have perfected/reached a stage on the subject and we know we are at a very infant stage but looking back we learned a lot from all of you.

Hope this journey continues for a very long long time to come.

Once again Thank You and Thank You All