iCharts Discussions

shashangan · Posted: Fri Nov 16, 2012 9:24 pm Post subject:

Sorry Dharmesh & acharyams,

I was on a long holiday with family. Was busy with some personal affairs.

Anyway was checking the weekly close. Thought of posting my view.

Like I had mentioned before play cautious, November will be a choppy mkt. Though I hinted a sharp correction, the reversal just slipped out of my hand.
I am not able to give full focus on intraday due to my various other activities, so I am at times going wrong on intra day. After mkt close I get time to sit & thoroughly to work out everything & do my analysis, so my long terms are coming right. I wish my work load is not there. I have to focus on my business for my bread.

Anyway, I am here again to caution everybody, Don't be surprised to see a short rally again. According to me, The mkt is around the bottom again. Near 5530 could be the max bottom. Long term players can buy on further dips.

The mkt is around reversal levels. It will target around min 5875 & 5900 area towards end of this month or by 1st week of December. Dont get trapped.

I could be wrong tho, Play mini if you dont want to risk, play safe.

Good luck & Enjoy your weekend
Gautham Shashangan

shashangan · Posted: Fri Nov 16, 2012 10:43 pm Post subject:

Acharya, last time you asked me if you could buy a call, Watch how the mkt is on monday & if you want you can try this time. You can also plan a strategy to buy a 5900 call of Dec, so you can either book profit or short the futures keeping the call as a hedge when mkt is @ 5900 or above later if I am right. I am asking to buy now since the premiums will be cheaper when mkt is far & sentiment is bearish.

The reason I am telling this is when i said there will be a sharp fall I had bought a 5500 put of Nov, so I can go long keeping the put as a cover now. I do same again, I will buy Dec 5900 or 6000 call now itself, so mkt gets there & when I feel mkt is topping I short the futures without booking the option profit

That's how I play the mkt. I go wrong sometimes, but most times when I catch the trend right I make very good profit because I dont have to place stops for my entry since I already have a hedge

Also what I do is I play 2 or 3 minis keeping one option as a hedge, so one mini I keep as a long term entry, one short term & one intra day, I book profit on the other & keep replacing the entry on the correction with the main trend.

Eg: I bought One Mini @ 5570 today, I will add one more Mini on Monday around 5540 & another at 5510 if I get seeing what could be the exact reversal point. So what I will do is I will keep one entry till the overall target 5875 & till the option is valid & the other one or two i keep booking profit & replacing on better prices one after other again.

Good luck
Gautham Shashangan

acharyams · Yellow Belt Joined: 04 Jul 2010 Posts: 552

shashangan · Posted: Sat Nov 17, 2012 11:12 am Post subject:

[/quote]
Thank you for detailed strategy. I will buy December 5900 call on Monday.
Further, I have one Nov. 5600 Call bought today at 41.8 and one Nov. 5700 Call bought earlier which I am planning to carry till expiry.[/quote]

There is a possibility mkt will get to 5700+ with in this month, but cant say anything yet. The sells offs were pretty sharp & mkt closed right at the lows on Friday. That would have triggered a panic in the people's mind, has the trend turned overall bearish. We need to see how mkt behaves from coming Monday.

My prediction, itself is a bold call with such a weak close on friday. But I think the overall bullish trend is still in tact, though short term a correction was required as I had expected. let's see. I am hoping I come right. The mkt will remain this way even in December. It will again make everybody turn bullish & suddenly they will hammer the mkt down unexpectedly, like now people all would be bearish & unexpectedly it will rally & will trap the shorts.

Thanks
Gautham Shashangan

rk_a2003 · Black Belt Joined: 21 Jan 2010 Posts: 2734

"like now people all would be bearish & unexpectedly it will rally & will trap the shorts"

Shashangan,

Who are people?---Common Investors/ Traders, HNI's,Small funds?.Who make it to rally? FII's,DII's?.Who trap Shorts?

In case you studied this aspect.Would you mind presenting the concrete answers.

shashangan · Posted: Sat Nov 17, 2012 1:29 pm Post subject:

RK, the common small investors are the people who get trapped both sides.

There are top technical analysts, Big funds (FII's, Corporate funds, Mutual funds & unknown people like Harshad mehta, Ketan parekh's & could be even ministers who are mkt movers). Sometimes there wont be any logic in the mkt direction. They all move together in teams & since their contracts will be huge, the mkt suddenly takes a turn, eating up all the stops of small investors & fundamental traders) which means your loss is their profit.

Certain techniques do work in the mkt more than fundamentals. Though I am a small player, I am trying to play the mkt how the big boys play. I read sentiments & technicals than news.

Well I dont claim I should be right. I started playing the mkt.s at a very young age & have played different international markets from forex, commodities, Nasdaq, Dow. So I have did lot of trail & errors from the time I started to eventually figure out something what works.

You dont have to buy my call. I am here to share my view. It's anybody's choice whether you want to follow me or not. I am also human & I have made huge un imaginable losses in the past & I still make mistakes. Play cautiously. Plan your risks & rewards. If my calls can give some help to anybody to make money I am happy.

Thanks & Good luck
Gautham Shashangan

rk_a2003 · Black Belt Joined: 21 Jan 2010 Posts: 2734

Shashangan ,

Somehow I am skeptical about this majority view. We need to dig in more, try to know the intricacies of the market.

My question is is the small investors’ money is enough for them and do the small investors have those deep pockets to continuously feed them?.

What I definitely knew is common people are scared about the market and give the same respect for trading as gambling or horse racing. Even they are not ready to give it at least the stature of lottery.

Why I am telling this is there is no way common people participate enmass in the markets atleast in India. This only can satiate big funds thirst. In fact some part of the big funds money is also from common people.

All these are just thoughts .Not able to conclude yet. But, for sure I know one thing market turns and tides are controlled.

Thanks for presenting your views.

shashangan · Posted: Sat Nov 17, 2012 2:08 pm Post subject:

You are right, See nobody can be continuous winner. Even big players lose on their bad day. Even they are taken by surprise when they have made a strategy to move the mkt & it doesn't move & they get trapped, but small players, Intra day traders, speculators mostly lose 95% cases. New people keep coming in the mkt when losers bail out for sometime. Some take sanyas from speculation, some come back again once they have saved up some money to recover back their old losses. So it's a cycle, there are lot of small investors also in the mkt.
The only people who remain in the mkt after 4-5 years of trading are the people who learned to play with discipline & who has learnt to control their impulses & have worked hard on understanding how the mkt functions. They still lose but have learnt to play with strategies. They stop averaging, they stop doing intraday's like normally how brokers encourage you by giving 10 -20 times exposure just to make their commission. I dont do it.

People keep one lot margin & play 10 lots. I keep 3-4 lots margin extra & play one lot & play only when i am sure. I dont care if my money is lying idle for days & I still prefer playing mini. Also I plan my strategies well in advance determining the trend, at times I also take a beating because I buy options well in advance as a hedge, at times it goes worthless, But it's the planning & discipline without letting room for emotions, which overall pays off all your efforts eventually.

Thanks
Gautham Shashangan

shashangan · Posted: Mon Nov 19, 2012 9:51 am Post subject:

Bought 1 Nov 5900 Call @ 1.50

Bought 1 Dec 6000 Call @ 8.10

Remember my Buy of options is for hedging my future positions, though the options itself can give small profit.

My purpose of Buy is to short 2 mini futures in Nov & 2 or 3 mini futures in Dec, when mkt gets above 5900 & 6000, keeping the calls open as a hedge to my futures entry. I mostly play options for hedging than making profit with options. Also the premiums are quite cheap & worth the risk.

Overall People rarely make money by playing only options, unless the investor is a extremely good analyst who can predict sharp short term moves. Long term option buys loses on time premium.

So if you really wanna make money you should learn to play options with futures as a combination to balance out your risk & playing both short term & medium term. Though if mkt doesn't get there in time as per your expectation, you can lose the premium. But the biggest advantage is you don't have to place a stop & you can play multiple entries for both short & medium term. I am hoping I come right.

Buy options preferably on Mondays, since the premiums reduces a bit on weekends or after a long holiday.

Good luck
Gautham Shashagan

shashangan · Posted: Tue Nov 20, 2012 10:21 am Post subject:

Nov Nifty - 5587-91 to 5614- 18 should be the range for a while. CMP 5594

shashangan · Posted: Tue Nov 20, 2012 1:14 pm Post subject:

Mkt has been quiet so far. I think it can take a small turn up again from 5574-78 region for now.

Gautham Shashangan

shashangan · Posted: Tue Nov 20, 2012 3:27 pm Post subject:

I think most probably Nifty is bottomed. It may just give one final dip doubtful though, before launching off. I could be wrong though. Do your own analysis & play cautiously.

Let's see, what happens tomorrow. Good luck.

Thanks
Gautham Shashangan

vinay28 · Black Belt Joined: 24 Dec 2010 Posts: 11748

I agree.

shashangan · Posted: Tue Nov 20, 2012 5:00 pm Post subject:

Great. Let's see tomorrow. I hope it opens with a gap up.

Thanks
Gautham Shashangan

shashangan · Posted: Wed Nov 21, 2012 9:11 am Post subject:

Mkt unchaged open