Monday, September 15, 2008

The Gambler........ Kenny Rogers

0630hrs: Oil down to 94$ a barrel. The talk is that technically it can hit a low of 85-86$ before a bounce back. US went down and under seeing 4.5% red on closing and Asia - Nikkei has opened red and trading 4.56% red. Another rocking day in making....

2237 hours: today after seeing the markets, I came back home, had a wonderful sleep. The reasons were basically two some, firstly, I had no exposure to the derivatives, and secondly, I give a damn to where my stocks go. Another thing that I did was to dig out Kenny Rogers song the The Gambler and heard it about 10 times. Out of those lyrics I will just post two sentences: -

....Said, if youre gonna play the game, boy, ya gotta learn to play it right.
You got to know when to hold em, know when to fold em,
Know when to walk away and know when to run.
You never count your money when youre sittin at the table.
Therell be time enough for countin when the dealins done.

Now evry gambler knows that the secret to survivin
Is knowin what to throw away and knowing what to keep.
cause evry hands a winner and evry hands a loser,
And the best that you can hope for is to die in your sleep.

These words are like a Prophecy on times such as these. I will not waste any more time and we'll get back to business. What Lehman Bros have done is that they have put out of business dozens of the world economies. It is at times like this that make you humble, no matter what you think about yourself. This act of the US, of not bailing out Lehman Bros may have shaken up the entire world economies but I believe that in the long run the action will hold in good stead. After all how long can the taxpayers money pay for your mistakes -- the mistakes that have been generated out of extreme flamboyance and overconfidence. This is not the first time that such an incident has happened and will not be the last. There was nothing but blood on the streets today. I don't want to recount what happened to our markets today. FTSE opened red and dropped further down by midday, recovering a little bit and ending at 3.92% down, Dax ended 2.74% in red and Cac closed 3.78% in red. After dropping the entire Asia and Europe in red -- the US red opening was the least US could do to sympathise with us. Dow opened red and is presently trading during the midsession 2.05% down. NASDAQ too opened red and this trading presently 1.29% down. S&P 500 too is down 1.89%. I somehow had a feeling that there was a slight chance that US recovers. If it does, then we might survive and not get slaughtered tomorrow. Otherwise anyone's guess is as good as mine.

I hope that no one is expecting magic in the charts -- the charts are as bad as they can be. The Bollinger bands that had constricted yesterday, have widened showing that the down trend is in place, the candles are not only trailing the lower edge but also going out of the band. 5 EMA is trailing well below the 20 EMA. The volumes, though less than yesterday are good enough. The MACD divergence has increased with the red line well below the blue. RSI is way down and bearish. The mass index is about to reach 25, and with every step it takes gets it closer to the 26.5 to 27 band, gives us more and more fear of the trend is changing to a downtrend. TRIX -- my favourite leading indicator is showing a downtrend. The only hope that I see in the charts today is that the slow statistic shows oversold conditions. The Red Line still trails below the blue line but both red and blue are in the oversold territory. Mind you, it can stay here for another day or so.

The international queues are not giving us any respite and neither are the charts. So, I am with the bears now till the time there is a turnround of indications on my chart. Purely by the charts the downside can go upto 3823 levels on nifty. For the more technical the support and resistances as per the pivot point calculations are as under: -
R3 4503
R2 4370
R1 4221
Pivot 4088
S1 3939
S2 3806
S3 3657

So those who would like to build up positions can look out for the break of support S1 and start buying. I feel that S1 should not be broken in a manner to continue the downtrend up to S2. Rest - just wait for the matinee show to begin at 9:55 AM.....


allvoices

5 comments:

Anonymous said...

excellent paaji....thought dow will close 250-300 down...surprised to see it 500 down....more gloom today...but why??.....crude 93...unbeleivable...petrol/deisel price cut bound to happen sooner or later....meaning atleast 1% lower inflation...what do you think...start buying autos atleas..??

c.m.

Amitbhai Shah said...

Sirji,

Uncle Dow
Nikki is down by 600+
Hangsang by 1000+

BSE by 800+
NIFTY 180+

To FII have sold shares worth 4200 crore from last monday still brokers have huge order to sell.

Crude is now 91.66 @ 8:49 AM.

Buying at this point is risky.

Your interest in Punj it will retrace 50% to 60%
upto 254 or 239 then u can buy this
and forget it will touch 400+

Today it will down to 254 or 250
signals are week.
MACD, RSI, ADX DMI
also below 5 and 20 days SMA

geniusjaggu said...

arre paaji,
uttho,stop dreaming,
subah hogayi mamu,

zara dekho mian,
nikkei...has become nikki..(gender changed!!!)
hangseng got "hanged"..
Straits times..has become Bend...

Sensex...will become ????(guess!!)

nifty...nowhere on the list..LOL

S S Cheema said...

Our markets out performing Asia - Hey bears I know you mean business - come on now - don't give up

Leoma said...

Interesting to know.