SGX Nifty 19th Oct 2016

SGX Nifty

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SGX Nifty 19th Oct 2016

SGX Nifty / Nifty Futures bounced back in style today. After a low of 8505 yesterday Nifty was up almost by 170 points from that low. There are many traders and analyst who are not clear as to what is going on but we have said that volatility and choppy moves will be taking place and most of them might not be trade able so just focus on the main trend which as per our understanding is down and keep taking positions in the direction of the main trend.

We once again reiterate that we do not see any significant upsides will sustain though from time to time sharp pullbacks will come which will actually end up just being counter trend moves and nothing more than that. Some people may call it the resumption of the up trend or the bull market but we do not see that as a possibility for now.  The trend is on the downside and in any pullbacks which will keep coming due to the choppy wave nature we do not think buying must be done rather selling only must be done.
As we have said that the final target of this move will end around 5872 spot Nifty level but that does not mean that pullback will not come. Pullbacks like the ones today will keep coming and forcing the weak hands out of the short trades but eventually when observed on larger time frame prices will keep trending lower and we do not see any upsides sustaining.

Once again we reiterate that markets will behave exactly like mercury retrograde period sharp  counter trend moves will keep coming from time to time and keep creating false breakouts and that will only be with a simple motive to trap traders on the wrong side of the trend.

As far as investments go we are very clear that most of the stocks in the market do not offer any value to invest at current levels and the overall valuations are steep. Further we do not see any sharp rise in corporate earnings because of which the valuations could come down. In such a environment we do not recommend buying into stocks. As far as our recommendations go MSL, Ugar Sugar, Bajaj Hindustan and Renuka sugar remain a hold, with renuka and ugar being in accumulate phase.  If you are trading or investing only on the basis of this post please use appropriate risk management and then only trade. We do not recommend over trading nor do we recommend leverage investing. Please manage your own risk and trade or invest.

Silver we remain bullish and on dips we recommend buying silver. We do not see any much downside for silver and we see silver price will start rallying fast towards our final target zone in the coming few days.

Good Trading To You!

60 thoughts on “SGX Nifty 19th Oct 2016

  1. Sir, thanks for the update. Did a mistake by shorting Nifty at 8580 but considering the risk had taken trade for Nov series. Now need to keep some patience. How do you see the US inflation data? Everyone talking that fed will raise rates only in Dec, do you still think fed will raise rates in Nov?


  2. As you mentioned in previous blog nifty will not sustain at higher side . But if you look at today’s move. Nifty opened just 40 point up and closed at 158 points up. after looking today’s move don’t you think this is still buy on dips market ??

  3. Just a small personal question. Glad if you answer . I am planning to double my SIP in equity fund from next month. In case market falls heavily I will get equity funds at lower prices. So is it right time to double SIP. My view for SIP is minimum 10 years .thanks in advance.

    1. sip is a wrong system according to me to invest. If we look at all the people who have made money they always bought cheap. SIP averages your buying there by no cheap if you add time value appreciation. Real money is only made buying value stocks cheap. Valuations are not cheap and no one in history has made money by buying at such valuations.

    2. Technically mallav is right .

      But for investor who dont have any knowledge of equity goes by route of mutual fund.
      Now for a investor who dont know abc of can he analyse when market are high or when it is low.
      So we go by route of sip. It creates a discipline in investing.
      As mallav ji is saying there will be lot of volatility.. so mr mitesh if you want to continue by mutual fund then u can double your sip of next 3 to 5 months.

      But be assure of your cash flows.
      Good luck

  4. Sir,
    Next 3-4 days imp for markets. As you said trend is down and this was corrective pullback of that down trend. But I guess now we need to monitor the Nifty movement if it closes above 8700. If Nifty closes above 8700 for more than 4 days, it would mean danger signal for shorters. Best luck


  5. Hi sir,
    Added more Shree Renuka at 15.9 today. Also entered ugar sugar today at 40. Would be buying in staggered manner in case of any dips. Thanks for these multibagger suggestions.


    1. I have been bearish since 9119 to 7400. Then we became bullish at 7400 till 8000 and then from 8000 to 8500 we were bearish then neutral from 8550 to 8900 and again bearish from 8900 to now

    1. I have been bearish since 9119 to 7400. Then we became bullish at 7400 till 8000 and then from 8000 to 8500 we were bearish then neutral from 8550 to 8900 and again bearish from 8900 to now

      1. Ok….so when can I expect multibagger only calls subscription? I cannot trade on a regular basis and more interested in wealth creation over long term. Thanks.

  6. Short karna bahut mehenga para mujhe since last 3-4 expiry continuous short position leading to heavy loss. Oct expiry put also goes in heavy loss.

    1. told sell calls not buying puts. Just by shorting calls we have been getting carry fwd premium of 120-150 points every month vs paying that prem every month.

    1. I have clearly said that pullbacks will not sustain and that does not mean day to day. Pullbacks will come and go if you are so clear then please go ahead and buy here against the trend the market will show you the way in a few days.

  7. Sir, do you see this pullback done or Nifty can still rally upwards from here on? I had expected this pullback from 8550-8700 but as Nifty had broken 8530 thought that upside game above 8570 was over but that was not the case.


      1. K if Nifty sustains above 7800 that would be dangerous for shorters. Have shorted couple of stocks today just before EOD, let’ s see if I can gain from this trade. As you have said if Nifty is on lower top and lower bottom path, I guess considering that Nifty should not sustain above 8700. Earlier tops as per what I identified were 8960/8870/8800. If Nifty reverses we can head towards 8350, kindly guide if wrong.


  8. You suggested selling calls but that need high capital and leads small profit only per lot. What could be the upside for this pullback sir. Everyone started talking of 8900-8950. Do you see any such cases now nifty 8700+.

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