state of the market 29 jan 2012
TRANSCRIPT
State of the Market ReportJan 29 2013
Deepak Singhwww.stateofthemarket.net
Opening Remarks
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The Market has a Mind of its Own – completely independent – and in it’s own unique way – it looks at economy, politics and stocks. To some…that view may appear quite bizarre at times
As a student of the market: Devote energy reading the mind of the market
rather than debate with the market
Is it easy to Read the Market?
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Absolutely Not….
The job of the market is to confuse people. Market does everything in his power to condition us in the wrong direction
There is a saying: “Never trust the market when its intention seem obvious”
Always reflect how market is
trying to condition you?
What has market been doing?
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Statement of Fact: Stalling at 6000+ levels on Nifty
2.86%
Month to Date
BUT Broader market does not look that great
1.92%
Month to Date
State of Nifty
Even on 10-day basis: the lows are at 5988-5990 and Highs at 6100
RBI Policy & Market expectations
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The market has already discounted a 25 bps rate cut
Does it mean?
25 bps Cut will invite Sell on News
Will market rally if there is 50 bps rate
cut?
What RBI says will matter more than what it does?
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RBI’s take on Economy
India's economic growth could fall to 5.5 per cent this fiscal before seeing gradual recovery next year. [This is lower than earlier estimate of 5.7%]
There would be a gradual recovery in 2013-14 and the economy could clock a growth of 6.5%.
Will RBI cut rates aggressively?
High inflation and widening Current Account Deficit (CAD) are big constraints in way of monetary easing
The big concern: Sticky Inflation
Under such circumstances, thinking of 50 bps rate cut looks like a stretch
What will constitute Breakout/Breakdown?
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The Closing….Where Nifty closes for the day?
The Boundary is set…6100 on
bullish side and 5990 on bearish
side
Not Reacting is also a reaction
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Positioning of Bank Nifty
Chartalert.com
BANK NIFTY has hardly made any move in Jan 2013
Lows/Support: 12530-12570
Highs: 12900
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The Big Problem
Distorted Liquidity Structure
FIIs continue to BUY
DIIs continue to Sell
Record Under ownership on Indian equitiesRecord over ownership
No Sign of Turnaround in
sentiment?What if sentiment
turns –ve?
FIIs +783 crores in cash mkt
DIIs -864 crores in cash mkt
The Big concer
n
FIIs record ownership
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FIIs ownership of Indian stocks as measured in the BSE 200 reached an all time high as of December 2012….
Macquarie Report
Stocks that witnessed record Buying:
Tech Mahindra , Indusind Bank , Housing Development Finance Corp Mahindra and Mahindra Financial Services , Mahindra and Mahindra
Record trimming of position: Aditya
Birla Nuvo
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Tracking INR
The rupee weakened on Monday, posting its biggest
single-day fall in three weeks
Pearls of Wisdom
Trading Lesson
Never Give up on Stop Loss
Frustration:
I know, I know, every time you have a stop loss in the market, the market moves just enough to stop you out, right?
Problem is Not Stop Loss But where you place Stop Loss
Well it might mean that you should evaluate where you place your stops (this is where good trading journals come in handy), but once you’ve done your analysis and placed the trade, you need to be committed to the trade and your plan. The only adjusting you should do is to lock in your profits
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Mark Hodge
One Big stock cannot break the market
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Come on, admit it, if you'd seen today's headlines four months ago regarding Apple you'd have bet the farm or at least the orchard that the S&P would be below 1,300." - Jeff Cooper
Reality: S&P500 is at 1500 despite Apple meltdown
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Thank You
• Disclaimer - The state of the market presentation is Deepak's perspective on the market. The presentation is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this presentation you agree to make no trade relying in whole or in part on the comments of the writers
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